EXHIBIT 10.118
ONYX ACCEPTANCE FINANCIAL CORPORATION
SECOND
AMENDED AND RESTATED
SALE AND SERVICING AGREEMENT
dated as of November 30, 2001
ONYX ACCEPTANCE CORPORATION
TABLE OF CONTENTS
Page No.
Table of Contents................................................................................ i
ARTICLE I DEFINITIONS............................................................................ 1
Section 1.1 Definitions.......................................................................... 1
ARTICLE II PURCHASES AND SALES................................................................... 2
Section 2.1 Agreements to Purchase and to Sell................................................... 2
Section 2.2 Purchase Price....................................................................... 3
Section 2.3 Payment of Purchase Price............................................................ 3
Section 2.4 Delivery............................................................................. 3
ARTICLE III CONDITIONS TO PURCHASE............................................................... 4
Section 3.1 Conditions to Effectiveness.......................................................... 4
Section 3.2 Conditions Precedent to Payment of Purchase.......................................... 4
ARTICLE IV REPRESENTATIONS, WARRANTIES AND COVENANTS............................................. 4
Section 4.1 Representations and Warranties of the Seller and the Servicer........................ 4
Section 4.2 Representations and Warranties of the Seller Concerning Contracts.................... 9
Section 4.3 Covenants of Seller.................................................................. 12
Section 4.4. Covenants of Servicer............................................................... 18
Section 4.5 Repurchase of Ineligible Contracts................................................... 21
Section 4.6 Financial Covenants of Seller........................................................ 21
Section 4.7 Representations and Warranties of Xxxxx.............................................. 22
Section 4.8 Collecting Title Documents Not Delivered on the Purchase Date........................ 23
ARTICLE V SELLER NOTE AND SUBORDINATED NOTE...................................................... 23
Section 5.1 Seller Note.......................................................................... 23
Section 5.2 Restrictions on Transfer of Seller Note.............................................. 24
Section 5.3 Subordinated Note.................................................................... 24
Section 5.4 Restrictions on Transfer of Subordinated Note........................................ 26
ARTICLE VI TERMINATION OF COMMITMENT............................................................. 27
Section 6.1 Termination.......................................................................... 27
Section 6.2 Remedies............................................................................. 27
ARTICLE VII INDEMNIFICATION, ADDITIONAL COSTS, INSPECTION AND CERTAIN LITIGATION MATTERS......... 27
Section 7.1 Indemnities.......................................................................... 27
Section 7.2 Rights of Inspection................................................................. 29
Section 7.3 Certain Litigation Matters........................................................... 29
ARTICLE VIII THE SERVICER........................................................................ 30
Section 8.1 Appointment of Servicer.............................................................. 30
Section 8.2 Collections.......................................................................... 31
Section 8.3 Maintenance of Records; Quarterly and Annual Reports................................. 32
Section 8.4 Servicing Fee........................................................................ 33
Section 8.5 Resignation; Sub-Contracting......................................................... 33
Section 8.6 Termination.......................................................................... 34
Section 8.7 [RESERVED]........................................................................... 34
Section 8.8 Daily Report......................................................................... 34
Section 8.9 Monthly Report....................................................................... 34
Section 8.10 Servicer Termination Events......................................................... 34
Section 8.11 Servicer Termination................................................................ 35
Section 8.12 Appointment of Successor Servicer................................................... 36
ARTICLE IX MISCELLANEOUS......................................................................... 37
Section 9.1 Notices, Etc......................................................................... 37
Section 9.2 Successors and Assigns............................................................... 38
Section 9.3 Confirmation of Intent; Security Interest............................................ 38
Section 9.4 Payments............................................................................. 39
Section 9.5 Rights to Enable Successor Servicing................................................. 39
Section 9.6 Costs; Expenses and Taxes............................................................ 39
Section 9.7 Severability Clause.................................................................. 39
Section 9.8 Amendments; Governing Law............................................................ 39
Section 9.9 No Recourse.......................................................................... 40
Section 9.10 Further Assurances.................................................................. 40
Section 9.11 Termination......................................................................... 40
Section 9.12 Assignment to Program Manager....................................................... 40
Section 9.13 Counterparts........................................................................ 40
Section 9.14 Headings............................................................................ 41
Section 9.15 No Bankruptcy Petition Against Xxxxx................................................ 41
Section 9.16 Surety Provider Defense Costs....................................................... 41
EXHIBIT A Seller Note
EXHIBIT B Subordinated Note
EXHIBIT C Officer's Certificate
EXHIBIT D List of Lock-Box Banks and Numbers of Lock-Boxes
EXHIBIT E Clearing Account Bank and Account Number
EXHIBIT F [RESERVED]
EXHIBIT G Form of Servicer's Certificate
EXHIBIT H Form of Daily Report
EXHIBIT I Form of Monthly Report
SCHEDULE 4.1(h)-1 Principal Place of Business, Etc. of Seller
SCHEDULE 4.1(h)-2 Principal Place of Business, Etc. of Servicer
SCHEDULE 4.1(k)-1 Trade Names of Seller
SCHEDULE 4.1(k)-2 Trade Names of Servicer
SCHEDULE 4.1(r)-1 Subsidiaries of Seller
ii
SCHEDULE 4.1(r)-2 Subsidiaries of Servicer
SCHEDULE 9.5 Licenses, Patents, Computer Hardware and Software, Etc
iii
SECOND
AMENDED AND RESTATED
SALE AND SERVICING AGREEMENT
SECOND AMENDED AND RESTATED SALE AND SERVICING AGREEMENT (the "Sale
Agreement" or this "Agreement"), dated as of November 30, 2001, between ONYX
ACCEPTANCE CORPORATION, a Delaware corporation, as seller (in such capacity, the
"Seller") and as servicer (in such capacity, the "Servicer"), and ONYX
ACCEPTANCE FINANCIAL CORPORATION, a Delaware corporation (together with its
successors and assigns, "Xxxxx"), as the purchaser.
W I T N E S S E T H:
WHEREAS, the Seller in the ordinary course of its business originates and
purchases contracts secured by automobiles, vans and light trucks; and
WHEREAS, the Seller wishes to sell certain of such contracts from time to
time to Xxxxx and Xxxxx desires to purchase such contracts; and
WHEREAS, from time to time in accordance with the consummation of the
transactions contemplated herein, Xxxxx desires to finance the purchases of such
contracts by advances made by Triple-A One Funding Corporation, which advances
will be secured by the contracts purchased by Xxxxx;
WHEREAS, the Seller and Xxxxx have entered into the Amended and Restated
Sale and Servicing Agreement dated as of September 4, 1998 (as amended to the
date hereof, the "Amended and Restated Sale Agreement"); and
WHEREAS, the parties hereto wish to further amend and restate the Amended
and Restated Sale Agreement as hereinafter provided.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions.
(a) As used in this Agreement, capitalized terms used herein
shall, unless otherwise defined herein, have the meanings assigned to them in
the Second Amended and Restated Definitions List dated as of the date hereof
that refers to this Agreement, which is incorporated herein by reference (the
"Definitions List").
(b) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular
provision of this Agreement, and Section, subsection, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
(c) Capitalized terms used herein shall be equally applicable to
both the singular and plural forms of such terms.
ARTICLE II
PURCHASES AND SALES
Section 2.1 Agreements to Purchase and to Sell.
(a) On each Purchase Date occurring prior to the Commitment
Termination Date, the Seller does hereby agree to sell, transfer, assign, set
over and otherwise convey, without recourse (except as expressly provided
herein), to Xxxxx and Xxxxx does hereby agree to purchase, without recourse
(except as expressly provided herein) all right, title and interest of the
Seller in and to (i) all Contracts originated, purchased or owned by the Seller
that have Outstanding Balances as of the close of business on the Business Day
immediately preceding such Purchase Date and all payment and enforcement rights
(but not any obligations) to, in and under such Contracts, (ii) all rights in
and to any Insurance Policies, (iii) any and all security interests in the
Vehicles, (iv) all monies due and to become due, and all amounts received, with
respect to the foregoing, (v) any and all Files related to such Contracts,
including the Dealer Assignment related to each Contract (vi) all Recoveries
related to such Contracts and (vii) all proceeds of the foregoing (including,
without limitation, "proceeds" as defined in Section 9-102 of the UCC as in
effect in the State of New York); provided that the Seller shall not be
obligated to sell any Contract to Xxxxx which (i) the Seller sells to a
Subsidiary of the Seller pursuant to (A) the Onyx/CSFB Warehouse Facility or (B)
any other warehouse or similar facility entered into with the prior written
consent of the Program Manager or (ii) is purchased or originated by the Seller
for the sole purpose of selling such Contract to an affiliated or unaffiliated
third party. Xxxxx shall not be obligated to make any purchase hereunder on or
after the Commitment Termination Date.
(b) It is the express and specific intent of the parties that the
transfer of the Purchased Contracts from the Seller to Xxxxx, as provided in
this Agreement, is and shall be construed for all purposes as a true, complete
and absolute sale of the Purchased Contracts.
(c) The Seller acknowledges that the Purchased Contracts are
subject to the security interest of the Collateral Agent for the benefit of the
holders of the Obligations pursuant to the Triple-A One Security Agreement and
that Triple-A One has assigned its rights under the Triple-A One Note (together
with its related rights under the Triple-A One Security Agreement) to the Bank
Collateral Agent pursuant to the Note Pledge Agreement.
(d) In connection with the Seller's sale of Contracts set forth
herein the Seller hereby transfers to Xxxxx all its right, title and interest in
and to each Lock-Box.
(e) In selecting the Contracts to be sold pursuant to clause (a)
the Seller shall employ selection procedures which are not adverse to the
interests of Xxxxx, Triple-A One or the Collateral Agent.
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Section 2.2 Purchase Price.
(a) The amount payable to the Seller by Xxxxx on each Purchase
Date occurring prior to the Commitment Termination Date in connection with any
sale hereunder shall be equal to the aggregate Outstanding Balances of the
Contracts set forth on the Contract List for such Purchase Date (the "Purchase
Price"), as set forth in the Daily Report dated such Purchase Date.
(b) The outstanding balance of Finance Charges shall not be
included in the calculation of the Purchase Price of any Contracts purchased on
any Purchase Date.
Section 2.3 Payment of Purchase Price.
(a) Prior to 9 A.M. (New York City time) on each Purchase Date,
including the Closing Date, the Servicer will determine the Purchase Price to be
paid on such Purchase Date. The Purchase Price shall be paid on the related
Purchase Date in the manner provided below:
(i) in cash, in an amount equal to the lesser of (A)
Available Funds on such Purchase Date and (B) the Purchase Price;
(ii) to the extent that the Purchase Price exceeds the
amount of the cash payment in (i) above, such excess shall be paid, on each
Purchase Date, by adjusting the principal amount of the Subordinated Note to
equal the Subordinated Interest on such Purchase Date; and
(iii) to the extent that the Purchase Price exceeds the
amount of the cash payment in (i) above and the adjustment to the principal
amount of the Subordinated Note in accordance with (ii) above, such excess shall
be paid, on each Purchase Date, by adjusting the principal amount of the Seller
Interest on such Purchase Date.
(b) Unless otherwise specified herein, all payments of the
cash component of the Purchase Price shall be made not later than 4:00 P.M. (New
York City time) on the applicable Purchase Date in lawful money of the United
States of America in same day funds by depositing such amounts in the bank
account designated in writing by the Seller to Xxxxx, with a copy to the Program
Manager.
Section 2.4 Delivery. The Seller hereby agrees that all chattel paper and
instruments (as each such term is defined in the UCC), if any, representing or
evidencing any of the Purchased Contracts shall be promptly transferred to Xxxxx
pursuant to duly executed transfer instruments in form and substance
satisfactory to Xxxxx, the Collateral Agent and the Program Manager. All such
chattel paper and instruments shall be delivered into the possession of the
Servicer (acting in its capacity as custodian as described in Section 8.3(a)
hereof) or its agent or to such Person as the Collateral Agent may approve, on
or prior to the Purchase Date.
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ARTICLE III
CONDITIONS TO PURCHASE
Section 3.1 Conditions to Effectiveness. On or prior to the date hereof,
the following conditions shall have been satisfied:
(a) the conditions set forth in subsection 4.1 of the Triple-A One
Credit Agreement shall have been satisfied; and
(b) a Responsible Officer of the Servicer shall have executed and
delivered an officer's certificate to Xxxxx, with copies to the Collateral
Agent, the Surety Provider and the Program Manager, listing the servicing
officers of the Servicer.
Section 3.2 Conditions Precedent to Payment of Purchase Price. As a
condition precedent to the obligation of Finco to make payment of the Purchase
Price on any Payment Date, the following conditions shall have been satisfied on
or prior to such Payment Date:
(a) no Unmatured Wind-Down Event or Wind-Down Event shall have
occurred and be continuing on such Payment Date or would result from such
payment or from the application of the proceeds therefrom. By accepting payment
for the Purchased Contracts the Seller shall be deemed to certify that this
condition has been satisfied;
(b) Xxxxx shall have received all other approvals, legal opinions,
documents, instruments or items of information as it may reasonably request and
all of the foregoing shall be satisfactory in form and substance to Xxxxx, and
all corporate and other proceedings (if any) required to be taken shall be
satisfactory in form and substance to Xxxxx;
(c) an authorized officer of the Seller shall have executed and
delivered an officer's certificate to Xxxxx, with copies to the Collateral
Agent, the Surety Provider and the Program Manager, substantially in the form of
Exhibit C; and
(d) the conditions set forth in subsections 4.1, 4.2 and 4.3 of
the Triple-A One Credit Agreement shall have been satisfied.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 4.1 Representations and Warranties of the Seller and the
Servicer. The Seller represents and warrants as to itself, to Xxxxx and the
Program Manager, as of the date of this Agreement and as of any future Purchase
Date, and the Servicer represents and warrants as to itself (except as to
clauses (m), (o), (q), (s), (u) and (v) and, to the extent relating to the
Seller, clauses (g), (h), (k) and (r) of this Section 4.1, as to which the
Servicer makes no representation or warranty) to Xxxxx and the Program Manager,
as of the date of this Agreement and as of each Payment Date, as follows:
(a) Corporate Existence. It is a corporation duly incorporated, validly
existing and in good standing under the laws of the state of Delaware, with full
corporate power and
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authority to conduct its business and to own its properties and other assets and
is duly qualified to do business and is in good standing in every jurisdiction
in which the nature of its business requires it to be so qualified.
(b) Corporate Power; Authorization; Non-Contravention. The
execution, delivery and performance by it of this Agreement, the other Operative
Documents to which it is a party and all other agreements, instruments and
documents to be delivered by it hereunder and thereunder, and the transactions
contemplated hereby and thereby, are within its corporate powers, have been duly
authorized by all necessary corporate action, do not contravene (i) any
Requirement of Law applicable to it or (ii) any Contractual Obligation of it,
and do not result in or require the creation of any Lien or any other claim upon
or with respect to any of its properties (other than those contemplated
hereunder); and no transaction contemplated hereby requires compliance with any
bulk sales act or similar law. This Agreement and all the other Operative
Documents to which it is a party have been duly executed and delivered on its
behalf.
(c) No Consents. No authorization or approval or other action by,
and no notice to or filing with, any Governmental Authority or regulatory body
is required for the due execution, delivery and performance by it of this
Agreement, the other Operative Documents to which it is a party or any other
agreement, document or instrument to be delivered by it hereunder and
thereunder, or for the perfection of, or the exercise by, Xxxxx or any other
beneficiary or assignee hereof or thereof of its rights or remedies under this
Agreement or any such Operative Document or other agreement, document or
instrument, except for the filing of the UCC financing statements referred to in
clause (o) of this Section 4.1, all of which, on or prior to the date hereof,
shall have been duly made and shall be in full force and effect.
(d) Enforceable Obligation. Each of this Agreement and the other
Operative Documents to which it is a party is and will be its legal, valid and
binding obligation, enforceable against it in accordance with its terms except
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforceability of
creditors' rights generally and by general equitable principles (whether
considered in proceedings in equity or at law).
(e) Financial Condition. Its audited consolidated balance sheet as
at December 31, 2000 and the related statements of income and retained earnings
and of cash flows for the fiscal year then ended, certified by
PricewaterhouseCoopers LLP, and its unaudited consolidated and consolidating
balance sheets as at September 30, 2001 and the related statements of income and
retained earnings and of cash flows for the nine-month period then ended, copies
of all of which have been furnished to Xxxxx, the Collateral Agent, the Surety
Provider and the Program Manager, fairly present the financial condition of it
and its consolidated Subsidiaries as at such date and the results of the
operations of it and its consolidated Subsidiaries for the period ending on such
date, all in accordance with GAAP, and since September 30, 2001 there has been
no material adverse change in such condition or operations or in the
collectibility of the Contracts which it owns or services.
(f) Material Litigation. Except as otherwise disclosed in writing
to Xxxxx, the Collateral Agent, the Surety Provider and the Program Manager
prior to the date hereof, there is no pending or threatened action, suit or
proceeding against or affecting it or any of its
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Subsidiaries or Affiliates or any of their respective officers or directors, in
such capacity, or the property of it or of any of its Subsidiaries or
Affiliates, in any court, or before any arbitrator of any kind, or before or by
any governmental body (i) with respect to this Agreement or the other Operative
Documents or any of the transactions contemplated hereby or thereby, or (ii)
which could have a material adverse effect on its or any Subsidiary's or
Affiliate's business, properties, assets, operations or condition, financial or
otherwise, or its ability to perform its obligations hereunder or under the
other Operative Documents.
(g) Accuracy of Information. (i) Each exhibit, financial
statement, document, book, record, report and other item of written information
furnished by it to the Collateral Agent, the Surety Provider, the Program
Manager or Xxxxx in connection with the Operative Documents is accurate as of
its date and as of the date so furnished and (ii) all financial projections
contained therein are based on reasonable and stated assumptions, and no such
item referred to in (i) or (ii) above contains any material misstatement of fact
or omits to state a material fact.
(h) Principal Place of Business. Its principal place of business
and chief executive office is located at the address referred to in Section 9.1
and the locations of the offices where it keeps all the records relating to the
Contracts, including without limitation, the Files are listed on Schedule
4.1(h)-1 (as to the Seller) and on Schedule 4.1(h)-2 (as to the Servicer)
hereto.
(i) Lock-Box. The names and addresses of all the Lock-Box Banks,
together with the account numbers of each Lock-Box, are specified in Exhibit D
hereto. Each Obligor has been directed to remit all funds in respect of the
Purchased Contracts only into the Lock-Boxes.
(j) Clearing Account. The name and address of the Clearing Account
Bank, together with the account number thereof, are specified in Exhibit E. All
funds in respect of the Purchased Contracts at any time on deposit in the
Clearing Account are held by the Clearing Account Bank subject to the security
interest of Capital Markets Assurance Corporation as collateral agent on behalf
of and for the benefit of the holders of the Obligations.
(k) Names. Except as set forth on Schedule 4.1(k)-1 (as to the
Seller) and Schedule 4.1(k)-2 (as to the Servicer), it has no tradenames,
fictitious names, assumed names or "doing business as" names.
(l) ERISA.
(i) No Plan is or has been a Multiemployer Plan. Except for
the Seller, neither Xxxxx nor any ERISA Affiliate of Xxxxx has maintained any
Plan which is subject to Title IV of ERISA. No Reportable Event has occurred
during the five-year period prior to the date on which this representation is
made or deemed made with respect to any Plan of the Seller, and each such Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code; provided, that any non-compliance by the Plan with the applicable
provisions of ERISA or the Code that is reasonably likely to, in MBIA's sole
discretion, subject Xxxxx to any tax, penalty or other liability, shall be
deemed material non-compliance. The present value of all accrued benefits under
each such Plan (based on those assumptions used to fund the Plans) did not, as
of the last annual valuation date prior to the date on which this representation
is made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits.
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(ii) If required to be filed, Schedule B (Actuarial
Information) to each most recent annual report (Form 5500 Series) has been filed
for each applicable Plan with the IRS and copies of such Schedule have been
furnished to the Program Manager and Xxxxx. Each such Schedule is complete and
accurate in all material respects and fairly presents the funding status of such
applicable Plan.
(iii) Each Plan which is intended to be qualified under
Section 401(a) of the Code is so qualified, and each trust related to any such
Plan has been determined to be exempt from federal income tax under Section
501(a) of the Code, and neither Xxxxx nor any ERISA Affiliate has materially
breached any of the responsibilities, obligations or duties imposed on it by
ERISA, the Code or regulations promulgated thereunder with respect to any Plan;
provided, that any breach of any of the responsibilities, obligations or duties
imposed on Xxxxx or an ERISA Affiliate by ERISA, the Code or regulations
promulgated thereunder with respect to any Plan, which breach is reasonably
likely to, in MBIA's sole discretion, subject Xxxxx to any tax, penalty or other
liability, shall be deemed a material breach.
(iv) Neither Xxxxx nor any ERISA Affiliate maintains or
contributes to any "employee welfare benefit plan" within the meaning of Section
3(1) of ERISA which provides benefits to employees after termination of
employment other than as required by Section 601 of ERISA, Section 4980B of the
Code, or any substantially similar state or local law.
(v) No Plan has incurred any accumulated funding deficiency
(as defined in Section 302 of ERISA and 412(a) of the Code), whether or not
waived.
(vi) Neither Xxxxx nor any ERISA Affiliate nor any
fiduciary of any Plan (i) has engaged in a nonexempt prohibited transaction
described in Sections 406 of ERISA or 4975 of the Code or (ii) has taken or
failed to take any action which would constitute or result in an ERISA
Termination Event.
(vii) Neither Xxxxx nor any ERISA Affiliate has incurred,
and no condition exists or event or transaction has occurred with respect to any
Plan that could result in, any withdrawal liability under Section 4201 of ERISA
that remains unpaid or liability to the PBGC which remains outstanding other
than the payment of premiums, and there are no such premium payments which have
become due which are unpaid.
(viii) Neither Xxxxx nor any ERISA Affiliate has (i) failed
to make a required contribution or payment to a Plan, (ii) made a complete or
partial withdrawal from a Multiple Employer Plan or a Multiemployer Plan or
(iii) failed to make a required installment or any other required payment under
Section 412 of the Code on or before the due date for such installment or other
payment.
(ix) Neither Xxxxx nor any ERISA Affiliate is required to
provide security to a Plan under Section 401(a)(29) of the Code due to a Plan
amendment that results in an increase in current liabilities for the plan year.
(m) Treatment of Transaction. It has not prepared any financial
statement which accounts for the transactions contemplated hereby in any manner
other than the sale of the Purchased Contracts by it, and it has not in any
other respect accounted for or treated the
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transactions in the Purchased Contracts by it contemplated hereby (including but
not limited to accounting and tax reporting purposes) in any manner other than
as a sale of, or absolute assignment of, its full right, title and ownership
interest in, the Purchased Contracts, to Xxxxx.
(n) Requirements of Law. Neither it nor any Subsidiary is in
violation of any Requirement of Law that could materially adversely affect its
operations or the conduct of its businesses or which is inconsistent with the
transactions contemplated by this Agreement.
(o) UCC Filings to Evidence Sale and Ownership Transfer. All
filings and recordings (including pursuant to the UCC in effect in the state in
which Onyx is incorporated) required to perfect a first priority ownership
interest in the Purchased Contracts in favor of Xxxxx, have been accomplished
and are in full force and effect.
(p) Taxes. It has filed or caused to be filed all Federal, state
and other tax returns which are required to be filed and has paid all taxes
shown to be due and payable on said returns or on any Federal, state and other
tax assessments made against it or any of its property and all other taxes, fees
or other charges imposed on it or any of its property by any Governmental
Authority having taxing power (other than any the amount or validity of which
are currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on its
books); no tax Lien has been filed, and no claim is being asserted, with respect
to any such tax, fee or other charge.
(q) Investment Company Act; Other Regulations. It is not an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. It is not
subject to regulation under any Federal or state statute or regulation which
limits its ability to incur Debt.
(r) Subsidiaries. Schedule 4.1(r)-1 (as to the Seller) and
Schedule 4.1(r)-2 (as to the Servicer) lists all of its Subsidiaries.
(s) Use of Proceeds. No proceeds of any purchase will be used by
the Seller in violation of Regulation T, U, or X of the Board of Governors of
the Federal Reserve System or to acquire any security in a transaction subject
to Section 13 or 14 of the Securities Exchange Act of 1934, as amended.
(t) No Material Adverse Change. Since the date hereof, there has
been no material adverse change in the collectibility of the aggregate Contracts
outstanding.
(u) Nature of Transfers. The transfers of Contracts by the Seller
to Xxxxx pursuant to this Agreement, and all other transactions between the
Seller and Xxxxx, have been and will be made in good faith and without intent to
hinder, delay or defraud creditors of the Seller.
(v) Solvency. On each Purchase Date, the Seller is not insolvent
and no sale of Contracts hereunder shall cause the Seller to become insolvent.
(w) No Change in Business. No change has been made in the
character of its business (except to the extent required by law, of which change
the Surety Provider, the
8
Collateral Agent and the Program Manager have received written notice), if such
change is reasonably likely to impair the collectibility of the Purchased
Contracts as a whole.
(x) No Change in Credit and Collection Policy. No change has been
made in the Credit and Collection Policy without the consent of the Surety
Provider, including without limitation, the amount and timing of finance
charges, fees and write-offs (except to the extent required by law, of which
change the Surety Provider, the Collateral Agent and the Program Manager shall
have received written notice).
Section 4.2 Representations and Warranties of the Seller Concerning
Contracts. On each Purchase Date the Seller represents and warrants to Xxxxx and
the Program Manager as follows:
(a) Eligible Contract. Each Contract to be sold by it on such day
is an Eligible Contract.
(b) Liens. Each Contract to be sold by it on such day is owned by
it free and clear of any Lien or claim of any kind or any offset and, upon
transfer to Xxxxx pursuant to this Agreement, Xxxxx will acquire a valid
ownership interest in each Purchased Contract free and clear of any Lien or
claim of any kind or any offset and no effective financing statement or other
instrument similar in effect covering any such Purchased Contract shall at any
time be on file in any recording office except those relating to this Agreement
and the transactions contemplated hereby.
(c) Compliance with Laws. Each Contract to be sold by it on such
day and the sale and financing of the related Vehicle complied at the time it
was originated or made and each Contract to be sold by it on such day complies
with all Federal, state and local laws and regulations applicable thereto,
including, without limitation, all usury and consumer credit laws.
(d) Enforceable Obligations; Nature of Contracts. Each Contract to
be sold by it on such day is in full force and effect and represents a legal,
valid and binding obligation of the Obligor enforceable against the Obligor in
accordance with its terms (except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforceability of creditors' rights generally and by general equitable
principles whether considered in proceedings in equity or at law) and
constitutes "chattel paper" under the UCC in effect in all applicable
jurisdictions including the state in which the Seller is incorporated.
(e) Valid Sale. The sale pursuant to this Agreement by the Seller
and the purchase by Xxxxx of the Purchased Contracts on such Purchase Date
constitutes and will constitute a valid sale of such Purchased Contracts and the
other Collateral and the proceeds thereof, which sale is and will be enforceable
against the Seller and all existing and future creditors of the Seller and all
subsequent purchasers from the Seller or Xxxxx of any of the Purchased
Contracts. Upon the filing of the financing statements described in Section
4.1(o) with the Secretary of State of the State of Delaware evidencing the sale
of the Purchased Contracts to Xxxxx and, in the case of Purchased Contracts
hereafter created and the proceeds thereof, upon the sale, transfer and
assignment thereof to Xxxxx, Xxxxx shall have a first priority
9
perfected ownership interest in the Purchased Contracts and the other Collateral
free and clear of any Lien.
(f) [RESERVED]
(g) Contract Information. The Contract Information delivered by
the Seller to Xxxxx (if the Seller is the Servicer) or by the Seller to the
Servicer (if the Seller is not the Servicer) with respect to each Purchased
Contract to be sold by it on such Purchase Date is true and correct.
(h) Inspections. Each Vehicle subject to a Contract to be sold by
it on such Purchase Date that is not originated by a Vehicle Dealer has been
inspected by CSI Escrow Document Services, Inc., the Servicer or any other
inspection company reasonably acceptable to the Program Manager ("Inspector"),
and the Inspector has issued a written inspection report (the "Vehicle Condition
Report") describing the Vehicle and the equipment in the Vehicle, confirming the
vehicle identification number and certifying that the Vehicle is in good repair.
(i) Repossessed Vehicles. The Contracts to be sold by it on such
Purchase Date will not result in the Outstanding Balance of Purchased Contracts
secured by Vehicles previously repossessed by or on behalf of the Seller (each,
a "Repossessed Vehicle") exceeding 1% of the aggregate Outstanding Balance of
all Purchased Contracts.
(j) Documentation. All documents used by the Seller in connection
with the purchase or origination of Contracts (including, without limitation,
any security agreement, loan contract or promissory note), and all certificates
of title and entries in the Paperless Title System for Vehicles securing
Contracts use the following words to identify the lender, secured party or
obligee: (i) "Onyx Acceptance Corporation" or some abbreviation thereof which
unmistakably identifies the Seller as secured party or (ii) "ABNI, Inc." or
"C.U. Acceptance Corporation"; provided, however, that the name "ABNI, Inc." or
"C.U. Acceptance Corporation" may only be used in such documents (x) with
respect to Contracts which have been repurchased by Onyx from a securitization
transaction guaranteed by MBIA or (y) if the Program Manager has received a true
sale and perfection opinion with respect to the transfer of such Contracts from
ABNI, Inc. or C.U. Acceptance Corporation (as the case may be) to Onyx,
addressed to the Program Manager satisfactory in form and substance to the
Program Manager from counsel to the Seller acceptable to the Program Manager in
its reasonable judgment.
(k) Nature of Receivable. Each Contract to be sold by it on such
day is an obligation representing all or part of the sales price of merchandise,
insurance or services.
(l) Contract Files. It has delivered to the Servicer (as custodian
for the Collateral Agent (on behalf of the holders of the Obligations)) or its
agent the Files relating to each Contract to be sold to Xxxxx on such Purchase
Date, and such Files are complete in all material respects; provided, however,
that as to any Purchased Contract, if (a) as evidenced by an opinion of counsel
delivered to and in form and substance satisfactory to the Program Manager, the
Surety Provider and the Collateral Agent, (x) an optical image or other
representation of the Files are enforceable in the relevant jurisdictions to the
same extent as the original of such document and (y) such optical image or other
representation does not impair the ability of an owner or
10
pledgee of such Contract to transfer its interest in such Contract, and (b) the
retention of such documents in such format will not result in a reduction of the
then current rating of the transaction and Triple-A One, without regard to the
Surety Bonds, such optical image or other representation may be held by the
Servicer (as custodian for the Collateral Agent on behalf of the holders of the
Obligations) or its agent in lieu of the Files.
(m) Software. Each of Xxxxx (and its successors and assigns) and
the Servicer has valid and enforceable rights to access and use any software and
computer programs necessary for the servicing and administration of the
Purchased Contracts.
(n) Selection. The Purchased Contracts were selected at random
from the Seller's Contracts, not in a manner adverse to the interest of Xxxxx or
the Collateral Agent and are representative of the types of Contracts held by
the Seller with respect to the creditworthiness of Obligors and collection
experience.
(o) Transfer. Each Purchased Contract prohibits sale or transfer
of the Vehicle without the consent of the Seller.
(p) Lawful Assignment. No Purchased Contract was originated in, or
shall be subject to the laws of any jurisdiction under which the sale, transfer
and assignment of such Purchased Contract hereunder or under the Operative
Documents or the pledge thereof under the Triple-A One Security Agreement is
unlawful, void or voidable.
(q) One Original. There is only one original executed copy of each
Purchased Contract.
(r) Weighted Average Remaining Term. The Contracts to be sold by
it on such day will not result in the Purchased Contracts owned by Xxxxx (after
giving effect to such Purchase) having a weighted average remaining term
exceeding 67 months.
(s) Title Documents. (A) If the related Purchased Contract was
originated in a state in which notation of a security interest on the Title
Document (or in the electronic title records) is required or permitted to
perfect the security interest in the related Vehicle, the Title Document or the
electronic title records for such Vehicle shows, or, if a new or replacement
Title Document is being applied for with respect to such Vehicle, the Title
Document (or electronic title record) will be received within 180 days of the
related Purchase Date and will show, Onyx named as the original secured party
under the related Purchased Contract as the holder of a first priority security
interest in such Vehicle, and (B) if the related Purchased Contract was
originated in a state in which the filing of a financing statement under the UCC
is required to perfect a security interest in motor vehicles, such filings or
recordings have been duly made and show Onyx named as the original secured party
under the related Purchased Contract, and in either case, upon the filing of UCC
financing statements as required by the Operative Documents, the Collateral
Agent on behalf of the holders of the Obligations will have the same rights as
such secured party has or would have (if such secured party were still the owner
of such Purchased Contract) against all parties claiming an interest in such
Vehicle. With respect to each Purchased Contract for which the Title Document
has not yet been returned from the Registrar of
11
Titles (or is not yet evidenced in the electronic title records), Onyx has
written evidence that such Title Documents showing Onyx as first lienholder have
been applied for.
(t) Delinquent Taxes. Regarding each Contract to be sold by it on
such day, there is no lien against the related Vehicle for delinquent taxes.
(u) Default, Breach, Violation or Event Permitting Acceleration.
Regarding each Contract to be sold by it on such day, (i) there is no default,
breach, violation or event permitting acceleration existing under such Contract
(except payment delinquencies on a Contract that is not a Delinquent Contact),
(ii) there does not exist any continuing condition that with notice or lapse of
time would constitute a default, breach, violation or event permitting
acceleration existing under such Contract, and (iii) the Seller has not waived
any such default, breach, violation or event permitting acceleration (except as
required by law and except for payment delinquencies on a Contract that is not a
Delinquent Contract).
(v) Blanket Policy. Regarding each Contract to be sold by it on
such day, each related Vehicle will be covered by the Blanket Policy.
(w) Comprehensive and Collision Insurance Policy and Other
Insurance Policies. (A) Each Contract to be sold by it on such day will require
that the related Obligor obtain and maintain in effect for the related Vehicle a
comprehensive and collision insurance policy (with standard deductibles) (i) in
an amount at least equal to the lesser of (x) its maximum insurable value or (y)
the principal amount due from the related Obligor under such Contract, (ii)
naming the Seller as a loss payee and (iii) insuring against loss and damage due
to fire, theft, transportation, collision and other risks generally covered by
comprehensive and collision coverage and (B) the Servicer or its agent shall
have insurance policies providing coverage upon repossession of the related
Vehicle in an amount equal to the lesser of the actual cash value of such
Vehicle, the cost of repair or replacement for such Vehicle and the unpaid
balance of the related Contract.
(x) Original Principal Balance. At the date of origination of the
Purchased Contract, the original principal balance of such Purchased Contract
was not greater than the purchase price to the related Obligor (including taxes,
warranties, licenses and related charges) of the related Vehicle.
Section 4.3 Covenants of Seller. The Seller covenants and agrees with
Xxxxx that so long as this Agreement shall remain in effect:
(a) Corporate Existence.
(i) It will preserve and maintain its corporate existence,
rights, franchises and privileges in the jurisdiction of its
incorporation, and qualify and remain qualified and in good standing as a
foreign corporation in each jurisdiction where the failure to maintain
such existence, rights, franchises, privileges and qualifications could
affect (x) the rights or interests of Xxxxx or the holders of the
Obligations hereunder, (y) the collectibility of any Contract or (z) its
ability to perform its obligations hereunder.
12
(ii) It shall at all times remain in good standing in all
respects in all jurisdictions in which it currently does business. In the
event that the Seller fails to remain in good standing in any such
jurisdiction, it shall promptly furnish to the Surety Provider and the
Program Manager (x) a certificate of an appropriate officer of the Seller
setting forth the circumstances surrounding such failure to remain in
good standing and any action taken or proposed to be taken by the Seller
with respect thereto, (y) such other information with respect to such
failure to remain in good standing as the Surety Provider or the Program
Manager may reasonably request, and (z) an opinion of counsel in form and
substance satisfactory to the Surety Provider and the Program Manager to
the effect that it is in good standing in such jurisdiction promptly
following the cure of such failure to remain in good standing.
(b) Master Record of the Contracts. It will, at its own cost and
expense, retain a master record of the Contracts sold by it and copies of all
documents and records relating to each such Purchased Contract and, at its own
cost and expense, xxxx such master record to the effect that the Purchased
Contracts listed thereon have been sold to Xxxxx.
(c) Recovery Procedure. It will maintain its Recovery Procedure in
good operational order and permit representatives of Xxxxx, the Servicer, the
Surety Provider, the Program Manager and the Collateral Agent access to its
management employees, upon reasonable prior notice and during normal business
hours, to fully discuss such Recovery Procedure. If it obtains a third party to
maintain such Recovery Procedure, then it shall arrange to permit
representatives of Xxxxx, the Servicer, the Surety Provider, the Program Manager
and the Collateral Agent, upon reasonable prior notice and during normal
business hours, access to such system to make such inspections and examinations
as it deems necessary.
(d) Conduct of Business. It will comply with all applicable laws,
rules, regulations, and orders with respect to it, its business and properties
and all Contracts it originates or purchases, the failure to comply with which
could have a material adverse affect on it or on the Purchased Contracts
(including the collectability thereof).
(e) Defense of the Purchased Contracts. It will not create, permit
or suffer to exist, and will take such other actions as are necessary to remove,
any Lien, claim or right in, to or on any Purchased Contract, and will defend
the right, title and interest of Xxxxx in and to the Purchased Contracts against
the claims and demands of all Persons whomsoever, other than (i) the Liens
created hereby and by the transactions contemplated hereby or (ii) Liens for
taxes which are being contested in good faith by appropriate proceedings,
provided that adequate reserves with respect thereto are maintained on the books
of Xxxxx in conformity with GAAP.
(f) Notice. It will advise Xxxxx (with a copy to the Program
Manager) in detail, of (i) any Lien asserted or claim made against any Purchased
Contract, (ii) the occurrence of any breach by it of any of its representations,
warranties and covenants contained herein, (iii) the occurrence of any Wind-Down
Event or Unmatured Wind-Down Event, (iv) any litigation, investigation or
proceeding which may exist at any time between it and any Governmental Authority
or other Person or default or event of default under any of its Contractual
Obligations, which in either case could have a material adverse effect on the
value of the Purchased Contracts or its ability to satisfy its obligations
hereunder and (v) any material adverse change in its
13
business, properties, operations or financial or other condition or the
occurrence of any other event which could have an adverse effect on the
collectibility or value of the Purchased Contracts or on the Program or on its
ability to perform its obligations hereunder, in each case immediately upon
ascertaining or obtaining knowledge of any of the foregoing. Each notice
pursuant to this subsection shall be accompanied by a statement of a Responsible
Officer setting forth details of the occurrence referred to therein and stating
what action it proposes to take with respect thereto.
(g) Maintain Interest.
(i) It shall, with respect to any and all Purchased
Contracts and security interests in Vehicles sold hereunder, at its expense,
perform all acts and execute all documents requested by Xxxxx, the Servicer, the
Collateral Agent, the Surety Provider or the Program Manager, as the case may
be, at any time to evidence, perfect, maintain and enforce the ownership
interest and security interest, respectively, of Xxxxx and the Collateral Agent
therein and the first priority of such ownership interest and security interest,
respectively. It will, at the request of a duly authorized officer of Xxxxx, the
Servicer, the Collateral Agent, the Surety Provider or the Program Manager,
prepare and deliver financing statements evidencing the ownership interest of
Xxxxx in all of the foregoing, which financing statements must be satisfactory
in form and substance to the Program Manager, and the Seller authorizes Xxxxx to
file one or more financing statements. It also hereby irrevocably appoints Xxxxx
its attorney-in-fact to file one or more financing statements on behalf of the
Seller.
(ii) It will not, without providing 30 days' notice to
Xxxxx, the Collateral Agent, the Surety Provider and the Program Manager, and
without filing such new financing statements or such amendments to any
previously filed financing statements as Xxxxx, the Servicer, the Collateral
Agent, the Surety Provider or the Program Manager may require, (A) change,
without limiting the provisions of Section 4.3(q), its state of incorporation or
(B) change its name, identity or corporate structure in any manner which might
make any financing statement or continuation statement filed by it pursuant to
the transactions contemplated hereby seriously misleading within the meaning of
9-506 (or any successor provision) of any applicable enactment of the UCC.
(iii) It will not change its principal place of business or
its chief executive office or the location of the office where the Files
relating to the Contracts are kept to a location outside the United States.
(h) Annual Certificate. It will deliver to Xxxxx, the Collateral
Agent, the Surety Provider and the Program Manager concurrently with the
delivery of its annual financial statements delivered pursuant to subsection (l)
of this Section 4.3, a certificate of a Responsible Officer dated as of a date
during the 90-day period following the end of the immediately preceding fiscal
year, either (i) stating that such action has been taken with respect to the
recording, registering, filing, re-recording, re-registering and re-filing of
financing statements, continuation statements or other instructions or documents
as is necessary to preserve and protect the interests of Xxxxx and the
Collateral Agent in and to the Purchased Contracts and related Vehicles and
reciting the details of such action or referring to opinions of counsel in which
such details are given and stating what action is required to be taken in the
subsequent 13-month
14
period to preserve and protect such interest or (ii) stating that no such action
is necessary to preserve and protect such interest.
(i) Character of Business; Normal Policies and Procedures; Credit
and Collection Policy. It will (i) at all times comply with its Credit and
Collection Policy, including, but not limited to, its customary practices with
respect to granting rebates and discounts, (ii) not change the character of its
business (except to the extent required by law, of which change the Surety
Provider, the Collateral Agent and the Program Manager shall receive written
notice), if such change is reasonably likely to impair the collectibility of the
Purchased Contracts as a whole, (iii) not materially change its normal policies
and procedures with respect to the servicing thereof (including, without
limitation, the amount and timing of finance charges, fees and write-offs) and
(iv) not change its Credit and Collection Policy (including, without limitation,
the amount and timing of finance charges, fees and write-offs), except (with
respect to this clause (iv)) with the prior written consent of the Collateral
Agent, the Surety Provider and the Program Manager or as required by any
Requirement of Law (in which case it shall give the Collateral Agent, the Surety
Provider and the Program Manager immediate written notice of such Requirement of
Law).
(j) Collections. If it receives Collections, it agrees to hold
such Collections in trust for the benefit of Finco and the Collateral Agent and
any such Collections received in the Lock-Boxes shall be transferred to the
Clearing Account on the next Business Day and any Collections received in any
other manner shall be transferred to the Clearing Account on the next Business
Day after receipt. Collections shall be transferred from the Clearing Account to
the Collection Account on the next Business Day after deposit into the Clearing
Account.
(k) Obligations Under the Contracts and Dealer Assignments. It
will duly fulfill all obligations on its part to be fulfilled under or in
connection with each Contract and related Dealer Assignment (if any) and will do
nothing to impair the rights of Xxxxx and the holders of the Obligations in the
Purchased Contracts. It agrees that, for the benefit of Xxxxx and the Collateral
Agent, it will continue to make and pursue claims on the Contracts sold by it
hereunder to the extent that any law, regulation or contractual provision
requires that it directly make and pursue such claims, for the benefit of Xxxxx
and the Collateral Agent; provided that the Seller agrees that it is making and
pursuing such claims for the benefit of Xxxxx and the Collateral Agent, and that
any funds received by the Seller based on such claims will be transferred to the
Clearing Account within one Business Day of being received and will thereafter
be transferred to the Collection Account on the next Business Day after deposit
into the Clearing Account.
(l) Financial Statements. It will furnish to Xxxxx (with a copy to
the Program Manager):
(i) as soon as available, but in any event within 90 days
after the end of each fiscal year, a copy of its consolidated balance sheets as
at the end of such year and the related statements of income and retained
earnings and of cash flows for such year, setting forth in each case in
comparative form the figures for the previous year, audited by
PricewaterhouseCoopers LLP or other independent certified public accountants of
nationally recognized standing;
15
(ii) as soon as available, but in any event not later than
90 days after the end of each fiscal year, a copy of its unaudited consolidating
balance sheets as at the end of such year and the related consolidating
statements of income and retained earnings and of cash flows for such year,
setting forth in each case in comparative form the figures for the previous
year, certified by a Responsible Officer as being fairly stated in all respects;
(iii) as soon as available, but in any event not later than
45 days (or 90 days with respect to the fourth quarter) after the end of each
quarterly period of each of its fiscal years, a copy of its unaudited
consolidated and consolidating balance sheets, as at the end of such quarter and
the related unaudited statements of income and retained earnings and of
consolidated cash flows for such period and the portion of the fiscal year
through the end of such period, setting forth in each case in comparative form
the projected budget amounts for such period and the figures for the previous
year, certified by a Responsible Officer as being fairly stated in all respects
when considered in relation to its financial statements (subject to normal
year-end audit adjustments); and
(iv) as soon as available, but in any event not later than
30 days after the end of each month (except at the end of those months in which
quarterly reports are due pursuant to paragraph (iii) of this Section 4.3(l)) of
each of its fiscal years, a copy of its unaudited consolidated balance sheets,
as at the end of such period and the related unaudited statements of income and
retained earnings and of cash flows for such period and the portion of the
fiscal year through the end of such period, setting forth in each case in
comparative form the projected budget amounts for such period and the figures
for the previous year, certified by a Responsible Officer as being fairly stated
in all respects when considered in relation to its financial statements (subject
to normal year-end audit adjustments).
All such financial statements shall be complete and correct in all
respects and to be prepared in detail and in accordance with GAAP applied
consistently throughout the periods reflected therein and with prior periods;
provided, however, that the unaudited financial statements referred to in clause
(iii) and (iv) above need not contain footnotes required under GAAP.
(m) Certificates; Other Information. It will furnish to Xxxxx,
with a copy to the Program Manager:
(i) concurrently with the delivery of the financial
statements referred to in clause (i) of paragraph (l) a certificate of its
independent certified public accountants reporting on such financial statements
stating that in making its normal examination for purposes of its annual audit
no knowledge was obtained of any Wind-Down Event or Unmatured Wind-Down Event,
except as specified in such certificate;
(ii) concurrently with the delivery of the financial
statements referred to in clauses (i) and (ii) of paragraph (l) a certificate of
a Responsible Officer stating that during such period it has observed or
performed all of its covenants and other agreements, and satisfied every
condition, contained in this Agreement and the other Operative Documents to be
observed, performed or satisfied by it, and that such Officer has obtained no
knowledge of any Unmatured Wind-Down Event or Wind-Down Event except as
specified in such certificate; such certificate
16
shall set forth the details of each Unmatured Wind-Down Event and Wind-Down
Event and the action which it has taken and proposes to take with respect
thereto;
(iii) no later than December 15th of each year, projections
by it of its operating budget and cash flow budget on a monthly basis for the
next fiscal year, certified by a Responsible Officer as being prepared in good
faith on the basis of the assumptions stated therein, which assumptions were
reasonable in light of conditions existing at the time of delivery thereof and
represented, at the time of delivery, as its best estimate of its future
financial performance;
(iv) within five Business Days after the same are sent,
made or filed, copies of all financial statements and reports which it may send
to, make to, or file with, the Securities and Exchange Commission or any state
securities commission and any financial statements and reports which it may send
to, make to, or file with, any other Governmental Authority; provided that if
such financial statements or reports are filed electronically with the SEC, then
such financial statements or reports shall be deemed furnished to Xxxxx and the
Program Manager upon receipt of notice of such filing by Xxxxx or the Program
Manager (as applicable).
(v) promptly, notification of each Purchased Contract which
becomes an Ineligible Contract pursuant to clause (b) of the definition of
"Ineligible Contract"; and
(vi) promptly, such additional financial and other
information as Xxxxx, the Program Manager, the Surety Provider or the Collateral
Agent may from time to time reasonably request.
(n) Delivery of Other Reports. It will furnish, or instruct the
Servicer to furnish any other reports required to be delivered pursuant to this
Agreement and the other Operative Documents.
(o) Annual Certificate. Concurrently with the delivery of its
financial statements with respect to each fiscal year required to be delivered
pursuant to clauses (i) and (ii) of paragraph (l), it will furnish to Xxxxx and
the Program Manager, a certificate of a Responsible Officer to the effect that
the facts upon which counsel to the Seller relied in giving its legal opinion on
the Closing Date, to the effect that the Seller and Xxxxx would not be
substantively consolidated for purposes of the Bankruptcy Code, have not
changed.
(p) Insurance.
(i) It will maintain, or cause to be maintained on its
behalf, with financially sound and reputable insurance companies, insurance on
all its property in at least such amounts and against at least such risks as are
usually insured against in the same general area by companies engaged in the
same or a similar business and furnish to Xxxxx (with a copy to the Program
Manager), at least annually, and otherwise upon written request, full
information as to the insurance carried. All such insurance policies relating to
any Collateral shall name Xxxxx and the Collateral Agent as additional insureds
and loss payees, as applicable, and shall provide that Xxxxx and the Collateral
Agent receive at least 30 days' prior written notice of the cancellation
thereof.
17
(ii) It will require each Obligor to obtain physical damage
insurance covering the Vehicle as of the execution of the related Purchased
Contract. It will maintain in full force and effect the Blanket Policy, and
shall at all times comply with all of the provisions of such insurance policy
applicable to it so long as such insurance policy is in effect. It shall at all
times comply with all of the provisions applicable to the Seller of the
insurance policies referenced in Section 4.2(w) hereof. It will immediately
deposit to the Collection Account all amounts received by it in respect of or as
proceeds of any Insurance Policy to the extent relating to Purchased Contracts
or related Vehicles.
(q) Merger or Consolidation. It shall not be a party to any
merger, consolidation, or other corporate transaction pursuant to which the
surviving entity or corporate successor is (i) not Onyx or (ii) not consented to
in writing by the Program Manager and the Surety Provider.
(r) Local Counsel Opinions. In the event that, at any time, the
Outstanding Balance of all Purchased Contracts originated in a single state
(other than the State of California) equals or exceeds 10% of the aggregate
Outstanding Balance of all Purchased Contracts, then the Seller shall, within 30
days following the occurrence of such event, deliver to the Program Manager, S&P
and Xxxxx'x an opinion of counsel with respect to the requirements under the
applicable laws of such state for the assignment of a security interest in a
Vehicle to the Collateral Agent for the benefit of the holders of the
Obligations. Such opinion of counsel shall be rendered by a firm the attorneys
of which are admitted to the practice of law in such state, and such opinion
shall be in form and substance acceptable to the Program Manager.
(s) Contracts Not to be Evidenced by Instruments. The Seller will
take no action to cause any Purchased Contract to be evidenced by an instrument
except in connection with the enforcement or collection of such Purchased
Contract.
Section 4.4 Covenants of Servicer. The Servicer covenants and agrees with
Xxxxx and the Program Manager that so long as this Agreement shall remain in
effect:
(a) Corporate Existence. It will preserve and maintain its
existence as a corporation in good standing under the laws of the state of
Delaware and in every jurisdiction where the failure to maintain such existence
or good standing could adversely affect the rights and interests of Xxxxx, the
Program Manager, the Collateral Agent or the holders of the Obligations
hereunder, or its ability to perform its obligations hereunder.
(b) Preservation of Electronic Ledger. It will, at its own cost
and expense, (i) retain the electronic ledger used by it as a master record of
the Purchased Contracts and copies of all documents relating to each Purchased
Contract as custodian for Xxxxx, the Program Manager, the Collateral Agent, the
holders of the Obligations, and to the extent permitted by the Operative
Documents, other Persons with interests in the Purchased Contracts, (ii) xxxx
such electronic ledger to the effect that the Purchased Contracts have been
transferred and assigned to Xxxxx and are subject to a security interest in
favor of the Collateral Agent for the benefit of the holders of the Obligations,
(iii) arrange for and maintain for the term of this Agreement an appropriate
off-site location for the storage of duplicate or back-up tapes containing the
master record of the Purchased Contracts and deliver or cause to be delivered on
at least a weekly basis to such site, such duplicate or back-up tapes, (iv)
provide or arrange for irrevocable access by the Collateral
18
Agent, the Surety Provider, the Program Manager and Xxxxx (upon reasonable
notice) to the off-site storage facility maintained by the Servicer pursuant to
subsection 4.4(b)(iii) hereof and (v) deliver duplicate or back-up tapes
containing the master record of the Purchased Contracts to the Program Manager
upon request by the Program Manager.
(c) Notices, etc. It will advise Xxxxx and the Program Manager
promptly, in reasonable detail, of (i) any Lien asserted or claim made against
any of the Purchased Contracts of which it obtains knowledge, (ii) the
occurrence of any breach by it of any of its representations, warranties and
covenants contained herein, (iii) the occurrence of any Servicer Termination
Event, Wind-Down Event or Unmatured Wind-Down Event, (iv) any litigation,
investigation or proceeding which may exist at any time between it and any
Governmental Authority or other Person or default or event of default under any
of its Contractual Obligations, which in any case could have a material adverse
effect on the value of the Purchased Contracts or its ability to satisfy its
obligations hereunder and (v) the occurrence of any other event, which could
have a material adverse effect on its business, properties or financial or other
condition or on the collectability or value of the Purchased Contracts or on the
Program or on its ability to perform its obligations hereunder in each case
immediately upon ascertaining or obtaining knowledge of any of the foregoing.
Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action it proposes to take with respect thereto.
(d) Right of Inspection. It will permit each of Xxxxx, the
Collateral Agent, the Surety Provider and the Program Manager, and their
representatives, at all times to have full and free access, upon reasonable
prior notice and during normal business hours, to all of its books,
correspondence and records insofar as they relate to the Contracts, the related
Vehicles or the related Files, and Xxxxx, the Collateral Agent, the Surety
Provider and the Program Manager, and their representatives may examine the
same, take extracts therefrom and make photocopies thereof, and it agrees to
render to Xxxxx, the Collateral Agent, the Surety Provider and the Program
Manager, or their representatives, at its sole cost and expense such clerical
and other assistance as may be reasonably requested with regard thereto.
(e) Delivery of Notices, Etc. It will deliver or cause to be
delivered to Xxxxx, Triple-A One, the Program Manager and the Collateral Agent,
as the case may be, such notices, documents, reports, certificates and other
documents (i) required to be delivered by it pursuant to the Operative Documents
and (ii) as may be reasonably requested by the Program Manager from time to
time.
(f) Merger or Consolidation. It shall not be a party to any
merger, consolidation, or other corporate transaction pursuant to which the
surviving entity or corporate successor is (i) not Onyx, or (ii) not consented
to in writing by the Surety Provider and the Program Manager.
(g) [RESERVED]
(h) Extension or Amendment of Contracts. It shall not amend,
modify or waive any term or condition of any Purchased Contract if such
extension, modification or waiver shall adversely affect the cash flow of such
Purchased Contract, unless (i) the Collateral Agent, Program Manager and the
Surety Provider shall have previously approved such extension,
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modification or waiver or (ii) such extension, modification or waiver shall be
in compliance with the Credit and Collection Policy; provided that it shall not
amend, modify or waive the Annual Percentage Rate or the principal balance of
any Purchased Contract such that the Annual Percentage Rate or the principal
balance of any Purchased Contract shall be effectively reduced, unless the
Collateral Agent, Program Manager and Surety Provider shall have previously
approved such extension, modification or waiver.
(i) Recovery Procedure. It will maintain its Recovery Procedure in
good operational order and permit representatives of Xxxxx, the Collateral Agent
and Program Manager access, upon reasonable prior notice and during normal
business hours, to its management employees to fully discuss such Recovery
Procedure. If it obtains a third party to maintain such Recovery Procedure, then
it shall arrange to permit representatives of Xxxxx, the Collateral Agent and
the Program Manager access, upon reasonable prior notice and during normal
business hours, to such system to make such inspections and examinations as it
deems necessary.
(j) Conduct of Business. It will comply with all applicable laws,
rules, regulations, and orders with respect to it, its business and properties
and all Contracts it services, the failure to comply with which could have a
material adverse affect on it or on the Purchased Contracts.
(k) Defense of the Purchased Contracts. It will not create, permit
or suffer to exist, and will take such other actions as are necessary to remove,
any Lien, claim or right in, to or on any Purchased Contract, and will defend
the right, title and interest of Xxxxx, the Program Manager and the Collateral
Agent in and to the Purchased Contracts against the claims and demands of all
Persons whomsoever, other than Liens permitted by Section 4.3(e).
(l) [RESERVED]
(m) Insurance. It will use reasonable efforts to insure that each
Obligor under a Purchased Contract maintains physical damage insurance covering
the related Vehicle. It will immediately deposit to the Collection Account all
amounts received by it in respect of or as proceeds of any Insurance Policy to
the extent relating to the Purchased Contracts or related Vehicles.
(n) Normal Policies and Procedures; Credit and Collection Policy.
It will (i) at all times comply with its Credit and Collection Policy,
including, but not limited to, its customary practices with respect to granting
rebates and discounts and (ii) not materially change its normal policies and
procedures with respect to the servicing thereof or change its Credit and
Collection Policy (including, without limitation, the amount and timing of
finance charges, fees and write-offs), except with the prior written consent of
the Collateral Agent, the Surety Provider and the Program Manager or as required
by any Requirement of Law (in which case it shall give the Collateral Agent, the
Surety Provider and the Program Manager immediate written notice of such
Requirement of Law).
(o) Collections. If it receives Collections, it agrees to hold
such Collections in trust for the benefit of Xxxxx and the Collateral Agent and
any such Collections received in the
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Lock-Boxes shall be transferred to the Clearing Account on the next Business Day
and any Collections received in any other manner shall be transferred to the
Clearing Account on the next Business Day after receipt. Collections shall be
transferred from the Clearing Account to the Collection Account on the next
Business Day after deposit into the Clearing Account.
(p) Obligations Under the Contracts and Dealer Assignments. It
will duly fulfill all obligations on its part to be fulfilled under or in
connection with each Purchased Contract and related Dealer Assignment (if any)
and will do nothing to impair the rights of Xxxxx or the Collateral Agent in the
Purchased Contracts.
(q) Contracts Not to be Evidenced by Instruments. The Servicer
will take no action to cause any Purchased Contract to be evidenced by an
instrument except in connection with the enforcement or collection of such
Purchased Contract.
(r) Delivery of Servicer's Extension Report. It will, on each
Determination Date, furnish to the Surety Provider a report (the "Servicer's
Extension Report") setting forth (i) the number of extensions granted by the
Servicer during the prior calendar month, and (ii) the Outstanding Balance of
all Purchased Contracts on which an extension has been granted by the Servicer
during the prior calendar month pursuant to Section 4.4(h) of this Agreement.
Section 4.5 Repurchase of Ineligible Contracts. On each Business Day, the
Seller and the Servicer will notify Xxxxx of the aggregate Outstanding Balances
of Purchased Contracts, if any, that are determined to be Ineligible Contracts
as of the preceding Business Day which notice shall specify such Purchased
Contracts. The Surety Provider and the Program Manager may also notify the
Seller and the Servicer on any Business Day of Purchased Contracts which the
Surety Provider or the Program Manager shall have determined to be Ineligible
Contracts. The Seller shall repurchase such Ineligible Contracts on the next
Determination Date to occur following the notification of ineligibility given or
received by it with respect thereto (a "Repurchase Date") by depositing in the
Collection Account the Purchase Price originally paid by Xxxxx with respect to
such Ineligible Contract, plus an amount equal to the amount of Finance Charges
that accrued on such Ineligible Contract from and including the Purchase Date
related to such Ineligible Contract to, but excluding, the Repurchase Date, less
an amount equal to the amount of Collections received by Xxxxx and deposited to
the Collection Account with respect to such Ineligible Contract to, but
excluding the Repurchase Date. On such Repurchase Date upon the payment in full
in cash of the Repurchase Price by the Seller, Xxxxx shall automatically and
without further action (other than the authorization and filing of applicable
UCC financing statements in connection with the reconveyance of such Ineligible
Contract) be deemed to transfer, assign, set-over and otherwise convey to the
Seller, without recourse, representation or warranty, all the right, title and
interest of Xxxxx in and to such Ineligible Contracts, all monies due or to
become due with respect thereto, and all proceeds thereof.
Section 4.6 Financial Covenants of Seller. The Seller covenants and
agrees with Xxxxx that so long as this Agreement shall remain in effect:
(a) Adjusted Tangible Net Worth to Total Assets. The percentage
equivalent of the ratio of Adjusted Tangible Net Worth to Total Assets shall be
at least 15% as of the end of each fiscal quarter.
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(b) Adjusted EBITDA Coverage Ratio. The Adjusted EBITDA Coverage
ratio shall be greater than 1:1 as of the end or each fiscal quarter.
(c) Ratio of Securitization Assets to Adjusted Tangible Net Worth.
The ratio of Securitization Assets to Adjusted Tangible Net Worth shall not be
greater than 3:1 as of the end of each fiscal quarter.
As used in this Section 4.6, the following terms shall have the following
meanings:
"Adjusted EBITDA Coverage": The sum of: (1) pre-tax income,
(2) interest expense, (3) amortization of excess servicing asset and (4) other
amortization and depreciation, less any gain on sale recognized according to
FASB 140 (or any successor FASB ruling), divided by interest expense, each of
the above listed items as they appear in the consolidated financial statements
of Onyx prepared in accordance with GAAP.
"Adjusted Tangible Net Worth": The sum of (i) Net Worth and
(ii) Eligible Subordinated Debt; provided, however, that for purposes of this
calculation, Eligible Subordinated Debt shall not exceed 20% of Adjusted
Tangible Net Worth.
"Eligible Subordinated Debt": The total subordinated debt
and non-common equity (i.e. preferred stock) of Onyx and its Subsidiaries on a
consolidated basis having original maturities of 3 years or more, plus the
outstanding principal balance of the $10,000,000 subordinated debt of Onyx in
favor of Bay View Capital Corporation, as lender.
"Net Worth": The amount equal to Total Assets minus Total
Liabilities of Onyx and its Subsidiaries on a consolidated basis calculated in
accordance with GAAP minus any intangible assets including inter alia, good
will, franchises and intellectual property.
"Securitization Assets": The sum of: (1) trust receivables
and (2) excess servicing (retained interest in securitized assets net of
amortization), each of the above listed items as they appear in the consolidated
financial statements of Onyx and its Subsidiaries prepared in accordance with
GAAP.
"Total Assets": All assets which in accordance with GAAP
would be included in determining total assets as shown on the assets side of the
consolidated balance sheet of Onyx and its Subsidiaries.
"Total Liabilities": All liabilities which in accordance
with GAAP would be included in determining total liabilities as shown on the
liability side of the consolidated balance sheet of Onyx and its Subsidiaries.
Section 4.7 Representations and Warranties of Xxxxx. Xxxxx represents and
warrants to the Seller and the Program Manager that, as of the date hereof and
as of each Purchase Date:
(a) Corporate Existence. Xxxxx is a corporation duly incorporated,
validly existing and in good standing under the laws of the state of Delaware,
with full corporate power and authority to conduct its business and to own its
properties and other assets, and is duly
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qualified to do business, and is in good standing in every jurisdiction in which
the nature of its business requires it to be so qualified.
(b) Corporate Power; Authorization; Non-Contravention. The
execution, delivery and performance by Xxxxx of this Agreement and all other
agreements, instruments and documents to be delivered by it hereunder, and the
transactions contemplated hereby and thereby, are within Xxxxx'x corporate
powers, have been duly authorized by all necessary corporate action, do not
contravene (i) Xxxxx'x charter or by-laws, (ii) any Requirement of Law
applicable to Xxxxx or (iii) any Contractual Obligation, and do not result in or
require the creation of any Lien upon or with respect to any of its properties
(other than as contemplated hereunder and under the terms and conditions of the
Operative Documents). This Agreement has been duly executed and delivered on
behalf of Xxxxx.
(c) Enforceable Obligation. This Agreement is the legal, valid and
binding obligation of Xxxxx enforceable against Xxxxx in accordance with its
terms except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforceability of creditors' rights generally and by general equitable
principles (whether considered in a proceeding in equity or at law).
Section 4.8 Collecting Title Documents Not Delivered on the Purchase
Date. In the case of any Purchased Contract in respect of which, in place of a
Title Document (or a notation in the electronic title records), the Servicer
received on the related Purchase Date written evidence from the Vehicle Dealer
selling the related Vehicle that, or otherwise in respect of which, the Title
Document or a notation in the electronic title records for such Vehicle showing
Onyx as first lienholder has been applied for from the Registrar of Titles, the
Servicer shall use its best efforts to collect (or to obtain evidence in the
electronic title records of) such Title Document from the Registrar of Titles as
promptly as possible. If such Title Document (or a notation in the electronic
title records) showing Onyx as first lienholder is not received by the Servicer
(or verified by the Servicer in the electronic title records) within 180 days
after the related Purchase Date with respect to each Purchased Contract, then
the representation and warranty in Section 4.2(s) as to any such Purchased
Contracts shall be deemed to have been incorrect in a manner that materially and
adversely affects the Collateral Agent, and the Seller shall be obligated to
repurchase such Purchased Contract in accordance with Section 4.5.
ARTICLE V
SELLER NOTE AND SUBORDINATED NOTE
Section 5.1 Seller Note.
(a) On the Closing Date, Xxxxx issued to the Seller the seller
note substantially in the form of Exhibit A (the "Seller Note"). The principal
amount of the Seller Note shall be calculated pursuant to the Daily Report and,
on any day, shall be equal to the Seller Interest on such day. The Seller Note
shall (x) be dated the Closing Date, and (y) be stated to mature on the
Scheduled Maturity Date. Interest on the principal amount of the Seller Note
shall accrue and be payable on each Determination Date, as provided in the
Triple-A One Security Agreement, at a rate per annum equal to the Seller Note
Interest Rate. Accrued but unpaid interest on Seller Note
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shall not be capitalized. The principal amount of the Seller Note shall not be
increased after the Commitment Termination Date.
(b) Seller agrees and confirms that the Seller Note represents
solely an obligation of Xxxxx to make certain payments from funds available
under the Triple-A One Security Agreement and only to the extent, in the manner
and at the times set forth in the Triple-A One Security Agreement, and that the
Seller Note does not represent an interest in, and is not secured by, the
Purchased Contracts, the proceeds thereof or any other Collateral.
(c) Xxxxx may at any time and from time to time prepay the Seller
Note, in whole or in part, without premium or penalty.
Section 5.2 Restrictions on Transfer of Seller Note. Neither the Seller
Note nor any right of the Seller to receive any payment thereunder, shall be
assigned, transferred, exchanged, pledged, hypothecated, participated or
otherwise conveyed except with the prior written consent of the Program Manager,
which consent shall not be unreasonably withheld or delayed.
Section 5.3 Subordinated Note.
(a) On the Closing Date, Xxxxx issued to the Seller the
subordinated note substantially in the form of Exhibit B (the "Subordinated
Note"). The principal amount of the Subordinated Note shall be calculated
pursuant to the Daily Report and, on any day, shall be equal to the Subordinated
Interest on such day; provided, however, that the principal amount of the
Subordinated Note shall be fixed on and not be recalculated after the Commitment
Termination Date; provided, further, that in no event shall the principal amount
of the Subordinated Note calculated pursuant to the Daily Report at any time
exceed the Required Overcollateralization Amount.
(b) Interest on the principal amount of the Subordinated Note
shall accrue at a rate set forth in the Subordinated Note. Principal and
interest payments on the Subordinated Note may be made to the extent permitted
by the Triple-A One Security Agreement. Principal amounts outstanding on the
Subordinated Note shall increase concurrently with the payment of the Purchase
Price pursuant to the terms of Section 2.3(a)(ii) hereof. Principal payments on
the Subordinated Note shall become payable only upon the release of Collateral
by the Collateral Agent pursuant to, and in accordance with, Section 23(b) of
the Triple-A One Security Agreement. Except to the extent permitted by the
Triple-A One Security Agreement, the Seller agrees not to ask, demand, xxx for
or take or receive from Xxxxx in cash or other property, by set-off or in any
other manner, (including, without limitation, from or by way of the Collateral),
payment of all or any part of the Subordinated Note.
(c) The Seller agrees upon any distribution of all or any of the
assets of Xxxxx to creditors of Xxxxx upon the dissolution, winding up, total or
partial liquidation, arrangement, reorganization, adjustment, protection,
relief, or composition of Xxxxx or its debts, any payment or distribution of any
kind (including, without limitation, cash, property, securities and any payment
or distribution which may be payable or deliverable by reason of the payment of
any other Debt of Xxxxx being subordinated to the payment of the Subordinated
Note) in respect of the Subordinated Note that otherwise would be payable or
deliverable upon or with respect to the
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Subordinated Note, directly or indirectly, by set-off or in any other manner,
including, without limitation, from or by way of the Collateral, shall be paid
or delivered directly to the Collateral Agent for application (in the case of
cash) to or as Collateral (in the case of non-cash property or securities) for
the payment or prepayment in full of, the Obligations (other than the
Subordinated Note) until the Obligations shall have been indefeasibly paid in
full in cash. The Collateral Agent is irrevocably authorized and empowered (in
its own name or in the name of the Seller or otherwise), but shall have no
obligation, to demand, xxx for, collect and receive every payment or
distribution referred to in the preceding sentence and give acquittance therefor
and to file claims and proofs of claim and take such other action (including,
without limitation, voting the Subordinated Note and enforcing any security
interest or other lien securing payment of the Subordinated Note) as the
Collateral Agent may deem necessary or advisable for the exercise or enforcement
of any of the rights or interest of Triple-A One. The Seller shall duly and
promptly take such action as the Collateral Agent may request to (i) collect the
Subordinated Note for the account of Triple-A One and to file appropriate claims
or proofs of claim in respect of the Subordinated Note, (ii) execute and deliver
to the Collateral Agent such powers of attorney, assignments or other
instruments as the Collateral Agent may request in order to enable the
Collateral Agent to enforce any and all claims with respect to, and any security
interests and other liens securing payment of, the Subordinated Note, and (iii)
collect and receive any and all payments or distributions which may be payable
or deliverable upon or with respect to the Subordinated Note.
(d) All payments or distributions upon or with respect to the
Subordinated Note that are received by the Seller contrary to the provisions of
the Operative Documents shall be received in trust for the benefit of the
holders of the Obligations, shall be segregated from other funds and property
held by the Seller and shall be forthwith paid over to the Collateral Agent in
the same form as so received (with any necessary endorsement) to be applied (in
the case of cash) to, or held as Collateral (in the case of non-cash property or
securities) for the payment or prepayment in full of, the Obligations until the
Obligations shall have been indefeasibly paid in full in cash. The Seller agrees
that no payment or distribution to Triple-A One pursuant to the provisions of
the Subordinated Note shall entitle the Seller to exercise any rights of
subrogation in respect thereof against Xxxxx until the Obligations and all
principal and interest under the Seller Note shall have been indefeasibly paid
in full in cash. The Seller and Xxxxx hereby waive promptness, diligence, notice
of acceptance and any other notice with respect to any of the Obligations and
any requirement that the Collateral Agent protect, secure, perfect or insure any
security interest or lien on any property subject thereto or exhaust any right
or take any action against Xxxxx or any other Person or any Collateral.
(e) The Subordinated Note is secured by the Collateral pursuant to
the Subordinated Security Agreement, subject to the prior lien of the Collateral
Agent under the Triple-A One Security Agreement. No payments may be received,
directly or indirectly, by the Seller (and if received, the Seller agrees to
return such payments to Xxxxx) on the Subordinated Note unless Xxxxx has paid
all amounts required pursuant to the Triple-A One Security Agreement to be paid
prior to any payments in respect of the Subordinated Note.
(f) The Seller agrees and confirms that the Collateral Agent shall
not have any duty whatsoever to the Seller as holder of the Subordinated Note
and that the Collateral Agent
25
shall not be liable to the Seller for any action taken or omitted to be taken
with respect to the Subordinated Note or the Collateral under the Triple-A One
Security Agreement.
(g) Prior to the indefeasible payment in full in cash of the other
Obligations, the Seller will not seek to collect any amounts owing under the
Subordinated Note or exercise or enforce any of its rights under the
Subordinated Security Agreement.
(h) The Seller and Xxxxx further agree that at no time hereafter
will any part of the indebtedness represented by the Subordinated Note be
represented by any negotiable instruments or other writings except the
Subordinated Note.
(i) The Seller and Xxxxx waive notice of and consent to the
creation of the Triple-A One Loans and any of the other Obligations, any
extensions granted or other action taken by Triple-A One, the Surety Provider,
the Program Manager, the Collateral Agent or the Bank Collateral Agent with
respect thereto, the taking or releasing of Collateral or any obligors or
guarantors for the payment thereof, and the releasing of the Seller or any other
subordinated creditors. No failure or delay by Triple-A One, the Surety
Provider, the Program Manager, the Collateral Agent or the Bank Collateral Agent
to exercise any right granted herein, or in any other agreement or by law shall
constitute a waiver of such right or of any other right.
(j) Xxxxx and the Seller agree to execute and deliver to Triple-A
One, the Surety Provider, the Program Manager, the Collateral Agent and the Bank
Collateral Agent such additional documents and to take such further actions as
Triple-A One, the Surety Provider, the Program Manager, the Collateral Agent or
the Bank Collateral Agent may hereafter require.
(k) The terms of the Subordinated Note and the subordination
effected hereby, and the rights of Triple-A One, the Surety Provider, the
Program Manager, the Collateral Agent and the Bank Collateral Agent and the
obligations of the Seller and Xxxxx arising hereunder, shall not be affected,
modified or impaired in any manner or to any extent by (a) any amendment or
modification of or supplement to any provision of the Operative Documents or any
instrument or document executed or delivered pursuant thereto or in connection
with the transactions contemplated thereby; (b) the validity or enforceability
of any of such documents; (c) any exercise or non-exercise of any right, power
or remedy under or in respect of the other Obligations or any instruments or
documents related thereto or arising at law; or (d) any waiver, consent,
release, indulgence, extension, renewal, modification, delay or other action,
inaction or omission in respect of the other Obligations or any of the
instruments or documents related thereto.
Section 5.4 Restrictions on Transfer of Subordinated Note. Neither the
Subordinated Note nor any right of the Seller to receive any payment thereunder,
shall be assigned, transferred, exchanged, pledged, hypothecated, participated
or otherwise conveyed; provided, however, that the Seller may pledge or
otherwise transfer the Subordinated Note with the prior written consent of the
Program Manager; provided, further, that any such transferee or pledgee of the
Subordinated Note shall (i) be bound by all of the terms applicable to the
Subordinated Note set forth in the Operative Documents and (ii) execute an
agreement containing a provision substantially in the form of Section 9.15
hereof.
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ARTICLE VI
TERMINATION OF COMMITMENT
Section 6.1 Termination.
(a) Subject to the payment of any and all fees required to be paid
pursuant to the Fee Letter Agreement, the Seller may terminate the commitment of
Triple-A One to make loans at any time by giving ten Business Days prior written
notice to Xxxxx and the Program Manager.
(b) The commitment of Triple-A One to make loans shall terminate
on the Commitment Termination Date.
Section 6.2 Remedies.
(a) On the Commitment Termination Date, all purchases by, and
sales to, Xxxxx of Contracts hereunder shall immediately cease.
(b) On and after the Commitment Termination Date, Xxxxx shall
have, in addition to all other rights under this Agreement, all rights and
remedies provided under any applicable law.
(c) On and after the Commitment Termination Date, Xxxxx shall
continue to maintain its interest in all Purchased Contracts created prior to
such date and all amounts received as payments on or with respect to the
Purchased Contracts will continue to be paid to Xxxxx as provided herein.
ARTICLE VII
INDEMNIFICATION, ADDITIONAL COSTS, INSPECTION AND CERTAIN
LITIGATION MATTERS
Section 7.1 Indemnities.
(a) Without limiting any other rights that Xxxxx may have
hereunder or under applicable law, the Seller hereby agrees to indemnify Xxxxx,
its directors, employees, officers, successors and assigns (collectively, the
"Indemnified Parties") from and against any and all damages, losses, claims,
liabilities and related costs and expenses, including all attorneys' fees and
disbursements (all of the foregoing being collectively referred to as the
"Indemnified Amounts"), awarded against or incurred by any of them arising out
of or as a result of this Agreement, the Operative Documents or Xxxxx'x
ownership of any Purchased Contracts, excluding, however, recourse (except as
otherwise specifically provided in this Agreement) for uncollectible Purchased
Contracts. Without limiting the generality of the foregoing, the Seller shall
indemnify the Indemnified Parties for all Indemnified Amounts relating to or
resulting from:
(i) the transfer of an interest in any Contract other than
an Eligible Contract;
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(ii) reliance on any representation or warranty made by the
Seller (or any of its Responsible Officers) or the Servicer (or any of its
Responsible Officers), if the Seller or any Affiliate of the Seller is acting as
the Servicer, under or in connection with the Operative Documents, and any
information or report delivered by the Seller or the Servicer pursuant hereto,
which shall have been false or incorrect in any material respect when made or
deemed made;
(iii) the failure by the Seller or the Servicer (if the
Servicer is the Seller or any Affiliate of the Seller) to comply with any
applicable law, rule or regulation with respect to any Purchased Contract or the
nonconformity of any Purchased Contract with any such applicable law, rule or
regulation;
(iv) the failure to vest and maintain vested in Xxxxx or to
transfer to Xxxxx, legal and equitable title to and ownership of, the Contracts
that are, or are intended to be, Purchased Contracts, together with all proceeds
thereof, including, without limitation, all Collections and other items that
constitute proceeds, free and clear of any Lien whether existing at the time of
the Purchase of such Contract or at any time thereafter, or the failure to
perfect, or to maintain the Lien on any Vehicle subject to a Purchased Contract;
(v) the failure to file, in a timely manner, financing
statements or other similar instruments or documents required under the UCC in
effect in the state in which the Seller is organized or the Seller's principal
place of business or chief executive office is located or the location of the
Collateral as required under such law or other applicable laws with respect to
any Contracts sold to Xxxxx, whether at the time of any Purchase or at any
subsequent time;
(vi) any defense, setoff, counterclaim, recoupment or
reduction of liability whatsoever under any Purchased Contract, arising out of a
breach by the Seller of any obligation under such Purchased Contract or arising
out of any other agreement, indebtedness or liability at any time owing to or in
favor of any other Person from the Seller (it being understood that all such
obligations of the Seller shall be and remain enforceable against and only
against the Seller and shall not be enforceable against Xxxxx);
(vii) any failure of the Seller or the Servicer (if the
Servicer is the Seller or any Affiliate of the Seller) to perform its duties or
obligations in accordance with the provisions of this Agreement;
(viii) any products liability claim or personal injury or
property damage suit or other similar or related claim or action of whatever
sort arising out of or in connection with merchandise or services which are the
subject of any Purchased Contract or any Vehicle;
(ix) the failure by the Seller or the Servicer (if the
Servicer is the Seller or any Affiliate of the Seller) to pay when due any taxes
payable by it,
28
including without limitation, franchise taxes and sales, excise, transfer or
personal property taxes payable in connection with the Contracts or the sale
thereof;
(x) the failure by the Seller or the Servicer (if the
Servicer is the Seller or an Affiliate of the Seller) to be duly qualified to do
business, to be in good standing or to have filed appropriate fictitious or
assumed name registration documents in any jurisdiction;
(xi) the commingling of Collections at any time with other
funds; and
(xii) the failure of any Lock-Box Bank or the Clearing
Account Bank to remit any amounts held in its Lock-Box or in the Clearing
Account as the case may be whether by reason of the exercise of setoff rights or
otherwise.
Notwithstanding the foregoing, Xxxxx hereby agrees that under no
circumstances shall the Seller be liable for, or required to pay any Indemnified
Amount, other than as set forth in Section 4.5, resulting from, (i) the credit
risk of an Obligor, or for which payment therefor would otherwise constitute
recourse to the Seller for an uncollectible Contract or Contracts (except to the
extent made uncollectible by acts or omissions of the Seller or, if the Servicer
is the Seller or an Affiliate thereof, the Servicer) or (ii) gross negligence or
willful misconduct on the part of the Indemnified Party to which such
Indemnified Amount would otherwise be due.
(b) Any Indemnified Amount due hereunder shall be payable 15 days
after demand.
Section 7.2 Rights of Inspection. Xxxxx, its representatives and assigns,
the Program Manager and the Surety Provider shall at all times have full and
free access, upon reasonable prior notice during normal business hours (a) to
the Seller's officers and independent accountants in order to discuss the
affairs, finances and accounts of the Seller insofar as they relate to the
Purchased Contracts, the related Files and/or the related Vehicles and the
transactions contemplated hereby and (b) to all the books, correspondence and
records of the Seller insofar as they relate to the Purchased Contracts, the
related Files and/or the related Vehicles and the transactions contemplated
hereby, and Xxxxx and its representatives and assigns, the Program Manager and
the Surety Provider may examine the same, take extracts therefrom and make
photocopies thereof, and the Seller agrees to render to Xxxxx, its
representatives and assigns, the Program Manager and the Surety Provider, at the
Seller's sole cost and expense, such clerical and other assistance as may be
requested with regard thereto. All such reasonable expenses of the Program
Manager and the Surety Provider shall be for the account of the Seller and shall
be provided for or reimbursed within 15 days after presentment of an invoice
requesting same.
Section 7.3 Certain Litigation Matters.
(a) Xxxxx and Onyx shall provide prompt written notice to the
Surety Provider, the Collateral Agent and the Program Manager of any action,
proceeding or investigation of which a Responsible Officer of Xxxxx or Onyx (as
applicable) has actual knowledge that could materially adversely affect the
rights or obligations of the Surety Provider, the Collateral Agent
29
or the Program Manager under the Operative Documents or any other document
delivered with respect thereto.
(b) Xxxxx and Onyx shall, upon written notice from the Surety
Provider, the Collateral Agent and the Program Manager, allow the Surety
Provider, the Collateral Agent or the Program Manager to institute, assume or
control the defense of any action, proceeding or investigation that could
materially adversely affect the rights or obligations of the Surety Provider,
the Collateral Agent or the Program Manager under the Operative Documents or any
other document delivered with respect thereto, if Onyx or Xxxxx (as the case may
be) shall not be actively defending such action, proceeding or investigation.
(c) Neither Xxxxx nor Onyx shall, without the Surety Provider's
prior written consent or unless directed by the Surety Provider, agree to any
settlement of any action, proceeding or investigation that could materially
adversely affect the rights or obligations of the Surety Provider, the
Collateral Agent or the Program Manager under the Operative Documents or any
other document delivered with respect thereto.
(d) For purposes of this Section 7.3 and the definition of "Surety
Provider Defense Costs" set forth in the Definitions List, and without limiting
the meaning of the term "materially," any of the following actions or
proceedings shall be deemed to materially adversely affect the rights or the
obligations of the Surety Provider, the Collateral Agent or the Program Manager:
(i) any action or proceeding brought as a putative class action or lawsuit where
the plaintiff is proceeding in a representative capacity, whether brought under
federal or state procedural rules; or (ii) any actions or proceedings where the
aggregate amount of damages sought against Onyx or Xxxxx in such actions or
proceedings shall be equal to or in excess of $1 million and in which the
underlying causes of action are related to Onyx's contract origination
procedures.
(e) Notwithstanding anything to the contrary herein, the terms of
this Section 7.3 and the definition of "Surety Provider Defense Costs" set forth
in the Definitions List shall not apply to any action or proceeding involving
any of the Seller, the Servicer or Xxxxx or any Affiliate of any of them, on the
one hand, and any of the Surety Provider, Triple-A One, CapMAC or CapFin, or any
Affiliate of any of them, on the other hand, as adverse parties, in any action
or proceeding.
ARTICLE VIII
THE SERVICER
Section 8.1 Appointment of Servicer. Xxxxx hereby appoints the Seller to
act as servicer of the Purchased Contracts in the name of and on behalf of
Xxxxx, its successors and assigns, in accordance with the provisions hereof and
the Seller hereby accepts such appointment. The Servicer shall use reasonable
care (and, in any event, no less care than it exercises with respect to all
Contracts it services for itself and others) in performing its duties as
servicer hereunder using at least that degree of skill and attention that a
prudent Person similarly situated and charged with similar functions would
utilize and, without limiting the foregoing, shall service the Purchased
Contracts in accordance with the Credit and Collection Policy, and all
applicable laws, rules and regulations. The Servicer or its agent shall hold the
Files.
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The duties of the Servicer will include, without limitation,
collection and posting of all payments, responding to inquiries of Obligors
regarding the Purchased Contracts, investigating delinquencies, remitting
payments to the Program Manager and the other Persons entitled thereto in a
timely manner, furnishing monthly, quarterly and annual statements with respect
to collections and payments in accordance with the provisions of this Agreement,
and maintaining the perfected first priority security interest of the Collateral
Agent in the Collateral as contemplated in this Agreement and the Triple-A One
Security Agreement. Subject to applicable laws, rules and regulations, the
Servicer shall accelerate the maturity of all or any scheduled payments under
any Purchased Contract under which a default under the terms thereof has
occurred and is continuing (after the lapse of any applicable grace period) no
later than the date such Contract becomes a Defaulted Contract. If required by
law, the Servicer shall collect all payments with respect to amounts due for
taxes, assessments and insurance premiums relating to such Contracts and remit
such amounts to the appropriate Governmental Authority or insurer on or prior to
the date such payments are due. In any case in which any Vehicle related to a
Purchased Contract has suffered damage, the Servicer will expend funds in
connection with any repair or toward the repossession of such Vehicle if it
reasonably determines that such repair and/or repossession will increase the
Recoveries by an amount greater than the amount expended.
The Servicer will be required to pay all expenses incurred by it
in connection with its activities under this Agreement, including fees and
disbursements of independent accountants, taxes imposed on the Servicer,
expenses incurred in connection with payments and reports pursuant to this
Agreement, and all other fees and expenses not expressly stated under this
Agreement to be for the account of the Seller. The Servicer will be required to
pay all reasonable fees and expenses owing to any bank or trust company in
connection with the maintenance of the Bank Accounts and the fees and reasonable
expenses of the Program Manager. The Servicer shall be required to pay such fees
and expenses for its own account and shall not be entitled to any payment or
reimbursement therefor other than as expressly provided for in the Operative
Documents.
Section 8.2 Collections.
(a) On each Business Day, all Collections received in any Lock-Box
shall be transferred to the Clearing Account on next Business Day. Except as
provided in Section 8.2(c), all Collections received by the Servicer in any
other manner shall be transferred to the Clearing Account on the next Business
Day following receipt and until so transferred, the Servicer shall hold such
cash and other items in trust for the benefit of Xxxxx. All Collections in the
Clearing Account shall be transferred to the Collection Account on the next
Business Day after such Collections are transferred into the Clearing Account.
(b) The Servicer will, at the Servicer's cost and expense and as
agent in the name of and on behalf of Xxxxx, but subject at any time to the
right of Xxxxx to direct and control, endeavor to collect, as and when the same
becomes due, all amounts owing on each Purchased Contract. In the event of
default by an Obligor under any Purchased Contract, the Servicer shall have the
power and authority, on behalf of Xxxxx, to take such action in respect of such
Purchased Contract and the Vehicle related thereto as the Servicer, in the
absence of contrary
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instructions from Xxxxx, may xxxx advisable, including the power to sell such
Vehicle; provided however that in no event shall the Servicer sell any Purchased
Contract without the prior written consent of the Surety Provider. In the
enforcement or collection of any Purchased Contract, the Servicer shall be
entitled to xxx thereon in its own name or as agent for Xxxxx, in either case,
for the account of Xxxxx.
(c) In the event the Servicer repossesses the Vehicle subject to
any Purchased Contract, the Servicer agrees to use its reasonable efforts to
resell such Vehicle for the account of Xxxxx and the Collateral Agent and shall
remit by deposit in the Collection Account the gross sale proceeds thereof, net
of any costs incurred by any Person with respect to any such repossession and
resale. Xxxxx shall have no obligation to take any action or commence any
proceedings to realize upon any Purchased Contract or to enforce any of its
rights or remedies with respect thereto. Any moneys collected by the Servicer
pursuant to this subsection shall be segregated by the Servicer, held in trust
by the Servicer for Xxxxx and shall be remitted to the Collection Account on the
Business Day of receipt thereof by the Servicer.
Section 8.3 Maintenance of Records; Quarterly and Annual Reports.
(a) The books of account and other records pertaining to the
Purchased Contracts are the property of Xxxxx and subject to the Lien of the
Collateral Agent. Xxxxx agrees that the Servicer shall hold such records as
custodian for the Collateral Agent (on behalf of the holders of the Obligations)
and Onyx. The Servicer shall maintain all books of account and other records
pertaining to the Purchased Contracts in such form as will enable Xxxxx or the
Program Manager or their designees to determine at any time the status of the
Purchased Contracts. The Servicer will permit Xxxxx or the Program Manager and
any Person designated by Xxxxx or the Program Manager, upon reasonable prior
notice and during regular business hours, to inspect, audit, check and make
abstracts from all books, accounts, records, or other papers pertaining to such
Purchased Contracts. From time to time, at the request of Xxxxx or the Program
Manager, the Servicer, at its own expense, will deliver to Xxxxx and the Program
Manager and any Person designated by Xxxxx or the Program Manager any records
and invoices pertaining to the Purchased Contracts and evidence thereof as Xxxxx
or the Program Manager or such designee may deem necessary to enable it to
enforce its rights thereunder. In addition, at the request of Xxxxx or the
Program Manager after delivery of a Servicer Termination Notice or earlier
termination or resignation of the Servicer, the Servicer will deliver all such
records and invoices pertaining thereto (including bills of lading) and other
evidence thereof to any Person selected by the Program Manager. Whether or not
any such item is the property of Xxxxx, each Contract, computer record, invoice,
ledger card, account record or other evidence of, or record relating to, the
Purchased Contracts maintained at the office of the Servicer or the office of
Seller, if requested by Xxxxx or the Program Manager, will be marked as the
Program Manager may direct to indicate the ownership thereof by Xxxxx and/or the
Lien of the Collateral Agent thereon. The Servicer will segregate from all other
Contracts then owned or being serviced by the Servicer all documents relating to
the Purchased Contracts and will hold in trust (if such document is not owned by
Xxxxx) and safely keep such documents in separate filing cabinets or other
suitable containers marked to show Xxxxx'x and the Collateral Agent's interest
with such legend as shall be specified by the Program Manager and maintained in
such place or places as shall be designated by the Program Manager.
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(b) The Servicer will deliver to Xxxxx and the Program Manager and
any Person designated by the Program Manager, within 45 days after the end of
each fiscal quarter of the Servicer, a certificate of a Responsible Officer of
the Servicer stating that (a) a review of the activities of the Servicer during
the preceding fiscal quarter and of its performance under this Agreement was
made under the supervision of the officer signing such certificate and (b) based
on such review, the Servicer has fully performed all its obligations under this
Agreement throughout such period (including its obligations to prepare and
deliver each Daily Report and Monthly Report) in compliance with the terms of
this Agreement, or, if there has been a default in the performance of any such
obligation, specifying each such default known to such officer and the nature
and status thereof.
(c) The Servicer, at its expense, will cause a firm of independent
public accountants satisfactory to the Program Manager to furnish a report (the
"Annual Report") to Xxxxx and the Program Manager and any Person designated by
the Program Manager, on or before March 31st of each year, beginning March 31,
2002, stating that such firm has examined certain documents and records relating
to the servicing of the Contracts during the preceding fiscal year and that such
examination, which has been conducted substantially in accordance with audit
guides or audit programs generally recognized to be applicable to audits of
receivables similar to the Contracts, has disclosed no items of noncompliance
with the provisions of this Agreement throughout such period which, in the
opinion of such firm, are material, except for such items of non-compliance as
shall be set forth in such report.
Section 8.4 Servicing Fee. On each Determination Date, to the extent
provided for in the Triple-A One Security Agreement and subject to Section
8.12(c) in the case of any Successor Servicer, as full compensation for its
servicing activities hereunder, the Servicer shall be entitled to receive the
Servicing Fee.
Section 8.5 Resignation; Sub-Contracting.
(a) The obligation of the Servicer to service the Purchased
Contracts is personal to the Servicer and the parties recognize that another
Person may not be qualified to perform such obligations. Accordingly, the
Servicer's obligation to service the Purchased Contracts hereunder shall be
specifically enforceable and shall be absolute and unconditional in all
circumstances, including, without limitation, after the occurrence and during
the continuation of any Servicer Termination Event hereunder; provided, however,
that a Successor Servicer may be appointed pursuant to Section 8.12 hereof.
(b) The Servicer shall not resign from the obligations and duties
hereby imposed on it as Servicer except upon determination that (i) the
performance of its duties hereunder is no longer permissible under any
applicable law and (ii) there is no reasonable action which the Servicer could
take to make the performance of its duties hereunder permissible under any such
applicable law. Any determination permitting the resignation of the Servicer
shall be evidenced as to clause (i) above by an opinion of counsel to such
effect delivered to Xxxxx and the Program Manager. Except to the extent
inconsistent with any such applicable law, no such resignation shall become
effective until a Successor Servicer shall have assumed the responsibilities and
obligations of the Servicer in accordance with Section 8.12 hereof.
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(c) If the performance of its duties hereunder is no longer
permissible under applicable law or the cost of such performance is such that
its continuation as Servicer is not warranted as a financial matter, the
Servicer may, with the prior written consent of the Program Manager and to the
extent permitted by applicable law, subcontract with any other Person to
service, administer or collect the Purchased Contracts, provided that the Person
with whom the Servicer so subcontracts shall not become the Servicer hereunder
and the Servicer shall remain liable for the performance of the duties and
obligations of the Servicer pursuant to the terms hereof.
Section 8.6 Termination. The Servicer's obligations under this Agreement
shall terminate upon the termination of both the Triple-A One Credit Agreement
and the Insurance Agreement; provided, however, that the Servicer shall continue
to be obligated to do all things necessary to apply Collections on the Purchased
Contracts that it receives after such termination in the manner provided in this
Agreement and to perform its obligations hereunder with respect thereto. Upon
termination of this Agreement all authority and power granted to the Servicer
under this Agreement shall pass to and be vested in Xxxxx. The Servicer shall
transfer (i) its electronic records relating to the Purchased Contracts to Xxxxx
in such electronic form as Xxxxx may reasonably request, (ii) all other records,
correspondence and documents to Xxxxx in the manner and at such times as Xxxxx
may reasonably request, (iii) at Xxxxx'x expense, upon the request of Xxxxx,
notify all Obligors that the Servicer is no longer the Servicer, (iv) at Xxxxx'x
expense, take all such further action as Xxxxx shall reasonably request to
effect the termination of the rights of the Servicer to conduct servicing
hereunder, including, without limitation, the transfer to Xxxxx of all authority
of the Servicer to (A) service Purchased Contracts as provided hereunder, and
(B) receive Collections which shall on the date of such termination be held by
the Servicer for deposit or which shall thereafter be received with respect to
any Purchased Contract.
Section 8.7 [RESERVED]
Section 8.8 Daily Report. No later than 3:00 PM (New York City time) on
each Purchase Date, the Servicer shall deliver a report, substantially in the
form of Exhibit H (the "Daily Report"), to Xxxxx and the Program Manager,
together with a Certificate of the Servicer, substantially in the form of
Exhibit G (the "Servicer's Certificate").
Section 8.9 Monthly Report. No later than 3:00 P.M. (New York City time)
on each Determination Date, the Servicer shall deliver a report, substantially
in the form of Exhibit I (the "Monthly Report") to Xxxxx and the Program
Manager, together with a Servicer's Certificate, covering the Determination
Period immediately preceding such Determination Date.
Section 8.10 Servicer Termination Events. If any of the following events
(each a "Servicer Termination Event") shall have occurred and be continuing:
(a) the Servicer shall fail to make any payment, transfer or
deposit required to be made hereunder or under any other Operative Document
within two Business Days of the date on which such payment, transfer or deposit
is due to be made;
(b) the Servicer shall fail to give any notice within three
Business Days after the same is required to be given hereunder;
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(c) the Servicer shall fail to submit (i) a Monthly Report within
three Business Days of the day on which such report shall have been required to
be submitted, (ii) a Daily Report within one Business Day of the day on which
such report is required to be submitted or (iii) an Annual Report within 10 days
of the day on which such Annual Report shall have been required to be submitted;
(d) the Servicer shall fail to observe or perform any other
covenant or agreement applicable to it contained herein or in any other
Operative Document and such failure shall remain unremedied for a period of 10
days; or, if the Seller or one of its affiliates is the Servicer, the Seller
shall breach any of the financial covenants contained in Section 4.6;
(e) the Servicer shall enter a corporate transaction in breach of
the covenant at Section 4.4(f) hereof;
(f) any representation, warranty, certification or statement made
by the Servicer in this Agreement, in any other Operative Document or in any
certificate, financial statement or other document delivered hereunder or
thereunder shall prove to have been incorrect in any material respect when made;
(g) a Bankruptcy Event shall have occurred with respect to the
Servicer or;
(h) the Wind-Down Date shall have occurred;
then, the Program Manager may, in its discretion, terminate the Servicer
by giving notice thereof in writing to the Servicer and Seller which notice
shall state the effective date of such termination (a "Servicer Termination
Notice"); provided that, in the case of a Servicer Termination Event described
in (g) above, the Servicer shall be terminated automatically without the
necessity to deliver a Servicer Termination Notice. Upon termination of the
Servicer, the Program Manager shall implement a Complete Servicing Transfer.
Section 8.11 Servicer Termination.
(a) After the termination of the Servicer, (i) prior to the
appointment of a Successor Servicer pursuant to Section 8.12, the Program
Manager may administer the administrative, servicing and collection functions of
the Servicer in any manner it deems fit, (ii) the Program Manager shall, at any
time thereafter, be entitled to notify the Obligors on any Purchased Contracts
to make payment of amounts due thereunder directly to Xxxxx or the Program
Manager or as the Program Manager may direct and (iii) the Servicer shall, at
its own expense, (A) if so requested by the Program Manager, endorse each
instrument that is payable to the Servicer, if any, evidencing any Purchased
Contract to the Program Manager in such manner as the Program Manager shall
direct and (B) perform any and all acts and execute any and all documents as may
be reasonably requested by the Program Manager in order to effect the purposes
of this Agreement. After termination of the Servicer, if the Program Manager
does not elect to replace the Servicer with a Successor Servicer, the Program
Manager shall have the right to appoint a firm of public accountants or any
other Person the Program Manager may choose, to monitor the servicing of the
Purchased Contracts by the Servicer and to furnish to Xxxxx, at the expense of
the Servicer, such letters, certificates or reports thereon as the Program
Manager shall reasonably request. The Servicer shall cooperate with such firm in
the subsequent monitoring of
35
its servicing of the Purchased Contracts pursuant to this Agreement and any fees
and expenses in connection therewith shall be paid by the Servicer.
(b) After termination of the Servicer:
(i) On the date that a Successor Servicer shall have been
appointed by the Program Manager pursuant to Section 8.12, all authority and
power of the then Servicer under this Agreement shall pass to and be vested in
such Successor Servicer, and, without limitation, the Program Manager is hereby
authorized and empowered to execute and deliver on behalf of the Servicer, as
attorney-in-fact or otherwise, all documents and other instruments upon the
failure of the Servicer to execute or deliver such documents or instruments, and
(upon the failure of the Servicer to cooperate) to do and accomplish all other
acts or things necessary or appropriate to effect the purposes of such transfer
of servicing rights.
(ii) The Servicer agrees to cooperate with the Program
Manager and the Successor Servicer in effecting the termination of the
responsibilities and rights of the Servicer to conduct servicing hereunder,
including, without limitation, the transfer to such Successor Servicer of all
authority of the Servicer to service the Purchased Contracts provided for under
this Agreement, including, without limitation, all authority to utilize
necessary software and programs and to receive Collections which shall on the
date of transfer be held by the Servicer for deposit, or which shall thereafter
be received with respect to the Purchased Contracts.
(iii) The Servicer shall promptly transfer duplicate,
back-up, or original tapes, and all other electronic media constituting all of
its electronic records relating to the Purchased Contracts and records relating
to the Commercial Paper Notes to the Successor Servicer in such electronic form
as the Successor Servicer may reasonably request and shall promptly transfer to
the Successor Servicer all other records, correspondence and documents necessary
for the continued servicing of the Purchased Contracts in the manner and at such
times as the Successor Servicer shall reasonably request.
(iv) At any time following the appointment of a Successor
Servicer, such Successor Servicer shall be authorized to take any and all steps
in the name of the previous Servicer and on behalf of the previous Servicer
necessary or desirable, in the determination of such Successor Servicer, to
collect all amounts due under any and all Purchased Contracts, including,
without limitation endorsing the name of the previous Servicer on checks and
other instruments representing Collections, and enforcing the Purchased
Contracts.
Section 8.12 Appointment of Successor Servicer.
(a) On and after the termination of the Servicer, the Servicer
shall continue to perform all servicing functions under this Agreement until the
later of (i) the appointment of a Successor Servicer or (ii) the date specified
in the Servicer Termination Notice or otherwise specified by the Program Manager
in writing or, if no such date is specified in the Servicer Termination Notice
(if any), until a date mutually agreed upon by the Servicer and the Program
Manager. The Program Manager shall appoint a successor servicer (the "Successor
Servicer")
36
and such Successor Servicer shall accept its appointment by a written assumption
in a form acceptable to the Program Manager.
(b) Upon its appointment, the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions
under this Agreement and shall be subject to all the responsibilities, duties
and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof, and all references in this Agreement to the Servicer shall be
deemed to refer to the Successor Servicer. Any Successor Servicer, by its
acceptance of its appointment, will automatically agree to be bound by the terms
and provisions of the Liquidity Agreement, if any are applicable. Any Successor
Servicer shall make all representations and warranties that the Servicer makes
hereunder.
(c) In connection with such appointment and assumption, the
Program Manager may, subject to the provisions of the Triple-A One Security
Agreement, make arrangements for the payment of the Servicing Fee to the
Successor Servicer.
(d) Notwithstanding anything to the contrary in this Agreement, no
termination of the Servicer shall be effective until a Successor Servicer shall
be appointed and have accepted such appointment.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Notices, Etc. Except where telephonic instructions or notices
are authorized herein to be given, all notices, demands, instructions and other
communications required or permitted to be given to or made upon any party
hereto shall be in writing and shall be personally delivered or sent by
overnight courier service or by registered, certified or express mail, postage
prepaid, return receipt requested, or by facsimile copy, or telegram (with
messenger delivery specified in the case of a telegram) and shall be deemed to
be delivered for purposes of this Agreement on (a) the second Business Day
following the day on which such notice was placed in the custody of the United
States Postal Service, (b) the next Business Day following the day on which such
notice was placed in the custody of any overnight courier service, including
express mail service or (c) the same Business Day on which such notice is sent
by telegram, messenger or facsimile. Unless otherwise specified in a notice sent
or delivered in accordance with the foregoing provisions of this subsection,
notices, demands, instructions and other communications in writing shall be
given to or made upon the respective parties hereto at their respective
addresses (or to their respective facsimile numbers) indicated below, and, in
the case of telephonic instructions or notices, by calling the telephone number
or numbers indicated for such party below:
If to the Seller: Onyx Acceptance Corporation
00000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Executive Vice President and
Chief Financial Officer
Tel. No.: (000) 000-0000
Telecopier No.: (000) 000-0000
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If to the Servicer: Onyx Acceptance Corporation
00000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Executive Vice President
and Chief Financial Officer
Tel. No.: (000) 000-0000
Telecopier No.: (000) 000-0000
If to Xxxxx: Onyx Acceptance Financial Corporation
00000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
Tel. No.: (000) 000-0000
Telecopier No.: (000) 000-0000
If to the
Program Manager: CapMAC Financial Services, Inc.
000 Xxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attention: Insured Portfolio Management,
Structured Finance
Tel. No.: (000) 000-0000
Telecopier No.: (000) 000-0000
A copy of any notice delivered to or required to be sent by the
Seller or Servicer hereunder shall be sent by the Seller or the Servicer to the
holder of the Subordinated Note.
Section 9.2 Successors and Assigns. This Agreement shall be binding upon
the parties hereto and their respective successors and assigns and shall inure
to the benefit of the parties hereto, the holders of the Obligations (each of
which shall be a third party beneficiary hereto) and their respective successors
and assigns; provided that the Seller shall not assign any of its rights or
obligations hereunder without the prior written consent of Xxxxx and the Program
Manager. Except as expressly permitted hereunder or in the Operative Documents,
Xxxxx shall not assign any of its rights or obligations hereunder without the
prior written consent of the Program Manager.
Section 9.3 Confirmation of Intent; Security Interest. The parties hereto
intend that the transfers to Xxxxx by the Seller of the property and assets
described in Section 2.1 including, without limitation, the Purchased Contracts,
all monies due or to become due with respect thereto and all collateral security
therefor, all proceeds of the foregoing, including, without limitation, all
Recoveries, as provided for herein be treated under applicable state law and
Federal bankruptcy law, at all times and in each case, as absolute and complete
sales by the Seller to Xxxxx; provided, however, that if for any reason any such
transfer is not considered a sale, the Seller hereby grants to Xxxxx a security
interest in all of the Seller's right, title and interest in the Purchased
Contracts and all other assets transferred to Xxxxx pursuant to Section 2.1(a)
hereof, as collateral security for the repayment by the Seller of a loan in the
amount of the aggregate
38
Purchase Price paid to it and this Agreement shall constitute a "security
agreement" within the meaning of Article 9 of the UCC.
Section 9.4 Payments. All payments made hereunder, except as provided for
in Section 2.3(b) hereof, shall be made by 2:00 P.M. (New York City time) on the
day provided for herein. Amounts not paid when due under this Agreement shall
bear interest until paid in full at a rate equal at all times to the lesser of
(a) the Default Rate and (b) the maximum rate permitted by applicable law,
payable on demand. Whenever any payment to be made under this Agreement shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day.
Section 9.5 Rights to Enable Successor Servicing. The Servicer hereby
represents and warrants to Xxxxx and the Collateral Agent that each of Xxxxx and
the Collateral Agent will have full and free access to, and use of, all rights
and properties necessary or appropriate for the servicing and collecting
functions with respect to Purchased Contracts including, without limitation, all
software rights, and hereby covenants that to the extent Xxxxx or the Collateral
Agent deem it necessary or appropriate, it will immediately transfer, assign and
set over to Xxxxx, the Collateral Agent or such party as the Collateral Agent
shall designate such rights and properties and any other rights or assets upon
the occurrence of a Wind-Down Event to enable and ease successor servicing
hereunder.
Section 9.6 Costs; Expenses and Taxes. In addition to the rights of
indemnification granted pursuant to Section 7.1 hereof, the Seller agrees to pay
on demand to Xxxxx, the Collateral Agent, the Surety Provider and the Program
Manager (a) all costs and expenses in connection with the development,
preparation, execution, delivery and administration (including periodic auditing
by Xxxxx, the Collateral Agent, the Surety Provider, the Program Manager or its
agents or representatives) of this Agreement, including, without limitation, the
reasonable fees and expenses of counsel for any Indemnified Party with respect
hereto and with respect to advising any such Indemnified Party as to their
respective rights and remedies under this Agreement, and (b) all costs and
expenses, if any (including reasonable counsel fees and expenses), in connection
with the enforcement of this Agreement.
Section 9.7 Severability Clause. Any provisions of this Agreement which
are prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provisions in any other jurisdiction.
Section 9.8 Amendments; Governing Law; JURY TRIAL WAIVER. This Agreement
and the rights (including those of the Program Manager and the Collateral Agent)
and obligations of the parties hereunder (a) may not be changed orally but only
by an instrument in writing signed by the parties hereto and the Program Manager
and (b) shall be construed in accordance with and governed by the laws of the
State of New York without regard to conflict of laws principles which may
require the application of the laws of any other jurisdiction. No amendment
shall be effective without prior written notice thereof to S&P and Xxxxx'x. EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION
OR PROCEEDING (ARISING OUT OF OR RELATING TO
39
THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR BY ANY OF THE
OTHER OPERATIVE DOCUMENTS) IN WHICH THEY SHALL BE ADVERSE PARTIES.
Section 9.9 No Recourse. Except as otherwise expressly provided in
Section 4.5 and 7.1 of this Agreement, it is understood and agreed that the
Seller shall not be liable for the payment of the principal of the Loans, or any
Commercial Paper or for the payment of any business taxes or for any losses
suffered by Finco in respect of ownership of the Purchased Contracts. The
preceding sentence shall not relieve the Seller from any liability hereunder
with respect to its representations, warranties, covenants and other payment and
performance obligations herein described. The Seller is not making any
representations or warranties regarding the collectibility of the Purchased
Contracts or the future performance of the Obligors under the Purchased
Contracts.
Section 9.10 Further Assurances. The Seller agrees to do such further
acts and things and to execute and deliver to Xxxxx such assignments,
agreements, powers and instruments as may be necessary or desirable in order for
Xxxxx to carry into effect the purposes of this Agreement and the other
Operative Documents or to better assure and confirm unto Xxxxx its rights,
powers and remedies hereunder and under the other Operative Documents,
including, without limitation, to record, notify, obtain consents and file and
to re-record, re-notify, re-obtain consents and re-file all such documents and
instruments, at such time or times, in such manner and at such places, all as
may be necessary to preserve and protect the position of the Seller or Xxxxx, as
the case may be, hereunder and under the other Operative Documents. This
covenant shall survive the termination of this Agreement.
Section 9.11 Termination. This Agreement shall terminate on the later of
(a) the date after the Commitment Termination Date of the payment in full of all
amounts due hereunder and the performance of all obligations hereunder and (b)
the date on which the Triple-A One Credit Agreement and the Insurance Agreement
are terminated; provided, however, that all representations, warranties,
remedies and indemnities of the Seller herein, and the agreements of the Seller
and the Servicer made pursuant to Section 9.15 hereof shall survive the
termination of this Agreement.
Section 9.12 Assignment to Program Manager. Xxxxx hereby assigns to the
Program Manager, all of its rights hereunder, including, without limitation, the
rights of Xxxxx under Section 6.2. The Seller consents to such assignment and
agrees that the Program Manager shall be entitled to enforce this Agreement
directly against the Seller. In addition, Xxxxx agrees to act as agent on behalf
of the Program Manager and shall not consent or agree to any waiver, amendment
or other modification of this Agreement or any of the other Operative Documents
to which it is a party without the Program Manager's prior written consent, and
shall take and refrain from taking any action, and shall exercise and refrain
from exercising any of its rights under the Operative Documents as requested by
the Program Manager from time to time, including, without limitation, the right
to deliver a Servicer Termination Notice.
Section 9.13 Counterparts. This Agreement may be executed in any number
of counterparts, and by the different parties hereto on the same or separate
counterparts, each of which shall be deemed to be an original instrument.
40
Section 9.14 Headings. Section headings used in this Agreement are for
convenience of reference only and shall not affect the construction or
interpretation of this Agreement.
Section 9.15 No Bankruptcy Petition Against Xxxxx. The Seller and the
Servicer each covenants and agrees that it will not institute against, or join
any other Person in instituting against, Xxxxx any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any Federal or state bankruptcy or similar law.
Section 9.16 Surety Provider Defense Costs. Onyx hereby agrees that the
Servicer, from amounts on deposit in the Collection Account, shall reimburse the
Surety Provider for all Surety Provider Defense Costs pursuant to Section 4(b)
and 5(b) of the Triple-A One Security Agreement.
41
IN WITNESS WHEREOF, the Seller and Xxxxx have caused this Sale and
Servicing Agreement to be duly executed by their duly authorized officers, all
on the day and year first above written.
ONYX ACCEPTANCE CORPORATION,
as Seller and Servicer
By:
-------------------------------------
Name:
Title:
ONYX ACCEPTANCE FINANCIAL CORPORATION
By:
-------------------------------------
Name:
Title:
Acknowledged and Agreed:
CAPMAC FINANCIAL SERVICES, INC.,
as Program Manager
By:
-----------------------------
Name:
Title:
42
EXHIBIT A
SELLER NOTE
New York, New York
September 12, 1994
ONYX ACCEPTANCE FINANCIAL CORPORATION, a Delaware corporation ("Xxxxx"),
hereby promises to pay to the order of ONYX ACCEPTANCE CORPORATION, a California
corporation (the "Seller"), the principal amount of this Seller Note, determined
as described below, together with interest thereon equal to the Seller Note
Interest Rate in lawful money of the United States of America. Capitalized terms
used herein but not defined herein shall have the meanings assigned to such
terms in the Definitions List, dated as of the date hereof, entered into in
connection with the Sale and Servicing Agreement, dated as of September 8, 1994,
between the Seller and Xxxxx (such agreement, as it may from time to time be
amended, supplemented or otherwise modified in accordance with its terms, the
"Sale Agreement").
The principal amount of this Seller Note at any time shall be determined
in accordance with the provisions of Section 5.1 of the Sale Agreement. All
principal and accrued interest on this Seller Note shall be due and payable on
the Scheduled Maturity Date; provided, however, that, no payments may be made,
directly or indirectly, on this Seller Note (and if made, the Seller agrees to
return such payments to Xxxxx) until Xxxxx has paid all amounts required
pursuant to the Triple-A One Security Agreement to be paid prior to any payments
in respect of this Seller Note. This Seller Note represents solely an obligation
of Xxxxx to make certain payments from funds available under the Triple-A One
Security Agreement and only to the extent, in the manner and at the times set
forth in the Triple-A One Security Agreement. This Seller Note does not
represent a security interest in the Collateral.
Payments of principal of and interest on this Seller Note shall be made
by wire transfer of immediately available funds to such account of the Seller as
the Seller may designate in writing.
This Seller Note is the Seller Note referred to in the Sale Agreement.
Xxxxx hereby waives diligence, presentment, demand, protest and notice of
any kind whatsoever. The nonexercise by the holder of any of its rights
hereunder in any particular instance shall not constitute a waiver thereof in
that or any subsequent instance.
All amounts evidenced by this Seller Note and all payments and
prepayments of the principal hereof and the respective dates and maturity dates
thereof shall be endorsed by the holder hereof on Schedule 1 attached hereto and
made a part hereof or on a continuation thereof which shall be attached hereto
and made a part hereof, or otherwise recorded by such holder in its internal
records; provided, however, that the failure of the holder hereof to make such a
notation or any error in such a notation shall not affect the obligations of
Xxxxx under this Seller Note.
It is the intention of Finco and the Seller to conform strictly to
applicable usury laws. Accordingly, if the transactions contemplated hereby
would be usurious under applicable law (including the laws of the State of New
York and the laws of the United States of America), then, in that event,
notwithstanding anything to the contrary in any agreement entered into in
connection with this Seller Note, it is agreed as follows: (i) the aggregate of
all consideration that constitutes interest under applicable law that is taken,
reserved, contracted for, charged or received under this Seller Note or any
other agreement or document executed in connection with this Seller Note shall
under no circumstances exceed the maximum amount of interest allowed by
applicable law, and any excess shall be credited to other amounts due under this
Seller Note by the holder hereof (or if this Seller Note shall have been paid in
full, refunded to Xxxxx); and (ii) in the event that the maturity of this Seller
Note is accelerated for any reason or in the event of any required or permitted
prepayment, then such consideration that constitutes interest may never include
more than the maximum amount allowed by applicable law, and excess interest, if
any, provided for in this Seller Note or otherwise shall be canceled
automatically as of the date of such acceleration or prepayment and, if
theretofore prepaid, shall be credited to other amounts due under this Seller
Note (or if this Seller Note shall have been paid in full, refunded to Xxxxx).
In the event that applicable law provides for a ceiling on the rate of interest
chargeable hereunder, that ceiling shall be the indicated rate ceiling.
The Seller agrees that it shall have no right to cause, by way of
acceleration or otherwise, any payment of principal hereunder to become due or
payable prior to the times provided in the Triple-A One Security Agreement.
Each holder of this Seller Note agrees to be bound by all of the
provisions of the Operative Documents, including, without limitation, the
covenant that prior to the date which is one year and one day after the payment
in full of all Commercial Paper issued, and all Triple-A One Loans made, by
Triple-A One and all other obligations under the Operative Documents, it will
not institute, or join any other Person in instituting, against Xxxxx any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or other similar proceedings under any federal or state bankruptcy law or
similar law.
This Seller Note may not be assigned, transferred, exchanged, pledged,
hypothecated, participated or otherwise conveyed, except with the prior written
consent of the Program Manager.
A-2
THIS SELLER NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE.
ONYX ACCEPTANCE FINANCIAL CORPORATION
By:
-------------------------------------
Name:
Title:
A-3
Schedule 1 to
Seller Note
Principal Payments and Maturity Notation Made
Date Amount Pre-payments Date By
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A-4
EXHIBIT B
SUBORDINATED NOTE
THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT FOR ANY OFFER OR SALE PURSUANT TO, AND IN COMPLIANCE WITH, THE SECURITIES
ACT AND THE RULES AND REGULATIONS THEREUNDER.
THIS SUBORDINATED NOTE IS THE SUBORDINATED NOTE REFERRED TO IN THE SALE
AND SERVICING AGREEMENT, AND IS SUBORDINATE AND JUNIOR IN RIGHT OF PAYMENT TO
ALL OF THE OBLIGATIONS TO THE EXTENT AND IN THE MANNER PROVIDED IN ARTICLE V OF
THE SALE AND SERVICING AGREEMENT; AND THE HOLDER BY ACCEPTANCE HEREOF AGREES TO
BE BOUND BY ALL THE PROVISIONS OF ARTICLE V OF THE SALE AND SERVICING AGREEMENT.
New York, New York
September 12, 1994
ONYX ACCEPTANCE FINANCIAL CORPORATION, a Delaware corporation ("Xxxxx"),
hereby promises to pay to the order of ONYX ACCEPTANCE CORPORATION, a California
corporation (the "Seller"), the principal amount of this Subordinated Note,
determined as described below, together with interest thereon at a rate per
annum of LIBOR + 6% in lawful money of the United States of America. Capitalized
terms used herein but not defined herein shall have the meanings assigned to
such terms in the Definitions List attached to the Sale and Servicing Agreement
dated as of September 8, 1994, between Xxxxx and the Seller (such agreement, as
it may from time to time be amended, supplemented or otherwise modified in
accordance with its terms, the "Sale Agreement").
The principal amount of this Subordinated Note at any time shall be
determined in accordance with the provisions of Section 5.3 of the Sale
Agreement. All principal of and interest on this Subordinated Note shall be due
and payable at the times provided in the Sale Agreement, it being understood and
agreed that, except as provided in Section 5.3 of the Sale Agreement, no
payments may be made, directly or indirectly, on this Subordinated Note until
all the Obligations have been indefeasibly paid in full in cash. This
Subordinated Note is secured by the Collateral pursuant to the Subordinated
Security Agreement subject to the prior lien of the Collateral Agent under the
Triple-A One Security Agreement. No payments may be received, directly or
indirectly, by the Seller (and if received, the Seller agrees to return such
payments to Xxxxx) on this Subordinated Note unless Xxxxx has paid all amounts
required pursuant to the Triple-A One Security Agreement to be paid prior to any
payment in respect of this Subordinated Note.
Payments of principal on this Subordinated Note shall be made by wire
transfer of immediately available funds to such account of the Seller as the
Seller may designate in writing.
This Subordinated Note is the Subordinated Note referred to in the Sale
Agreement, and is subordinate and junior in right of payment to all the
Obligations to the extent and in the manner provided in Section 5.3 of the Sale
Agreement and the holder by acceptance hereof agrees to be bound by all the
provisions of Section 5.3 of the Sale Agreement.
Xxxxx hereby waives diligence, presentment, demand, protest and notice of
any kind whatsoever. The nonexercise by the holder of any of its rights
hereunder in any particular instance shall not constitute a waiver thereof in
that or any subsequent instance.
All amounts evidenced by this Subordinated Note and all payments and
prepayments of the principal hereof and the respective dates and maturity dates
thereof shall be endorsed by the holder hereof on Schedule 1 attached hereto and
made a part hereof or on a continuation thereof which shall be attached hereto
and made a part hereof, or otherwise recorded by such holder in its internal
records; provided, however, that the failure of the holder hereof to make such a
notation or any error in such a notation shall not affect the obligations of
Xxxxx under this Subordinated Note.
It is the intention of Finco and the Seller to conform strictly to
applicable usury laws. Accordingly, if the transactions contemplated hereby
would be usurious under applicable law (including the laws of the State of New
York and the laws of the United States of America), then, in that event,
notwithstanding anything to the contrary in any agreement entered into in
connection with this Subordinated Note, it is agreed as follows: (i) the
aggregate of all consideration that constitutes interest, if any, under
applicable law that is taken, reserved, contracted for, charged or received
under this Subordinated Note or any other agreement or document executed in
connection with this Subordinated Note shall under no circumstances exceed the
maximum amount of interest allowed by applicable law, and any excess shall be
credited to other amounts due under this Subordinated Note by the holder hereof
(or if this Subordinated Note shall have been paid in full, refunded to Xxxxx);
and (ii) in the event that maturity of this Subordinated Note is accelerated for
any reason, or in the event of any required or permitted prepayment, then such
consideration that constitutes interest may never include more than the maximum
amount allowed by applicable law, and excess interest, if any, provided for in
this Subordinated Note or otherwise shall be cancelled automatically as of the
date of such acceleration or prepayment and, if theretofore prepaid, shall be
credited to other amounts due under this Subordinated Note (or if this
Subordinated Note shall have been paid in full, refunded to Xxxxx). In the event
that applicable law provides for a ceiling on the rate of interest, if any,
chargeable hereunder, that ceiling shall be the indicated rate ceiling.
The Seller agrees that it shall have no right to cause, by way of
acceleration or otherwise, any payment of principal hereunder to become due or
payable, prior to the times provided in the Triple-A One Security Agreement.
Each holder of this Note agrees to be bound by all of the provisions of
the Operative Documents, including, without limitation, the covenant that prior
to the date which is one year and one day after the payment in full of all
Commercial Paper issued, and all Triple-A One
B-2
Loans made, by Triple-A One and all other Obligations under the Operative
Documents, it will not institute against, or join any other Person in
instituting against, Xxxxx any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other similar proceeding under the law
of the United States or any state of the United States.
This Subordinated Note shall not be assigned, transferred, exchanged,
pledged, hypothecated, participated or otherwise conveyed, except with the prior
written consent of the Program Manager.
B-3
THIS SUBORDINATED NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE.
ONYX ACCEPTANCE FINANCIAL CORPORATION
By:
Name:
Title:
B-4
Schedule 1 to
Subordinated Note
Principal Payments and Maturity Notation Made
Date Amount Pre-payments Date By
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B-5
EXHIBIT C
ONYX ACCEPTANCE CORPORATION
OFFICER'S CERTIFICATE
The undersigned certifies that he is the [President] [Chief Financial
Officer] [an Executive Vice President] of Onyx Acceptance Corporation, a
Delaware corporation (the "Seller"), and that as such he is duly authorized to
execute and deliver this certificate on behalf of the Seller in connection with
the Second Amended and Restated Sale and Servicing Agreement dated as of
November 30, 2001 (the "Sale Agreement"), between the Seller and Onyx Acceptance
Financial Corporation, a Delaware corporation ("Xxxxx") (all capitalized terms
used herein without definition having the respective meanings specified in the
Second Amended and Restated Definitions List attached to the Sale Agreement),
and further certifies that:
1. no event with respect to the Seller has occurred and is
continuing which would constitute a Wind-Down Event or Unmatured
Wind-Down Event;
2. each of the agreements and conditions of the Seller to
be performed on or before the date hereof pursuant to the Sale
Agreement have been performed in all material respects;
3. The Seller has possession of each Contract set forth on
the Contract List delivered to Triple-A One and the Program
Manager on the date hereof (the "Specified Contracts");
4. On the date hereof, the Seller shall apply the cash
proceeds of the Purchase Price paid to it on the date hereof by
Xxxxx to purchase the Specified Contracts.
5. The Seller has delivered the Specified Contracts to
Xxxxx on or prior to the date hereof.
IN WITNESS WHEREOF, I have affixed hereunto my signature
this day of ____________, _____.
ONYX ACCEPTANCE FINANCIAL CORPORATION
By:
Name:
Title:
EXHIBIT D
LIST OF LOCK-BOX BANKS AND NUMBERS OF LOCK-BOXES
LOCK-BOX BANK:
Xxxxx Fargo Bank
0000 Xxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Lock-Box Account
Acct. # 4159359066
EXHIBIT E
CLEARING ACCOUNT BANK AND ACCOUNT NUMBER
The Clearing Account, No. 4159359173, is maintained at Xxxxx Fargo Bank,
0000 Xxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000.
EXHIBIT F
[RESERVED]
EXHIBIT G
[Form of Servicer's Certificate]
This Servicer's Certificate is delivered pursuant to the Second Amended
and Restated Sale and Servicing Agreement (the "Sale Agreement") dated as of
November 30, 2001 between Onyx Acceptance Corporation and Onyx Acceptance
Financial Corporation. Capitalized terms not defined herein have the meanings
ascribed to such terms in the Second Amended and Restated Definitions List
attached to the Sale Agreement.
The undersigned hereby certifies that he is a Responsible Officer of Onyx
Acceptance Corporation holding the office set forth beneath his signature below,
and that he is duly authorized to execute this Servicer's Certificate on behalf
of the Servicer and further certifies that the information set forth in the
report to which this Certificate is attached is true and correct in all material
respects, that there is currently no Servicer Termination Event, Unmatured
Wind-Down Event or Wind-Down Event and that all calculations and applications of
cash were performed in accordance with the Operative Documents.
IN WITNESS WHEREOF, I have affixed hereunto my signature this __ day of
______, ____.
ONYX ACCEPTANCE CORPORATION
By:
Name:
Title:
EXHIBIT H
[FORM OF DAILY REPORT]
EXHIBIT I
[FORM OF MONTHLY REPORT]
SCHEDULE 4.1(h)-1
PRINCIPAL PLACE OF BUSINESS, ETC. OF SELLER
Onyx Acceptance Corporation's (the "Seller") principal place of business,
chief executive office and the location of the offices where it keeps all of the
records relating to the Contracts including, without limitation, the Files, is:
27051 Xxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Xxxxxx DataBank
00000 Xxxxx Xxxxxxx
Xxxx Xxxxxx, Xxxxxxxxxx
SCHEDULE 4.1(h)-2
PRINCIPAL PLACE OF BUSINESS, ETC. OF SERVICER
Onyx Acceptance Corporation's (the "Servicer") principal place of
business, chief executive office and the location of the offices where it keeps
all of the records relating to the Contracts including, without limitation, the
Files, is:
27051 Xxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Xxxxxx DataBank
00000 Xxxxx Xxxxxxx
Xxxx Xxxxxx, Xxxxxxxxxx
SCHEDULE 4.1(k)-1
TRADE NAMES OF SELLER
Onyx Acceptance Corporation (the "Seller") has no trade names, fictitious
names, assumed names or "doing business as" names other than the following:
"Doing Business As" Name Business for which Name is Used
1. Automotive Banking Network Marketing/Advertising
2. AutoBank Services Used car sales
3. Mesa Auto Used car sales
4. Auto Fund Name reserved but not used
5. Automotive Funding Services Name reserved but not used
6. OAC Systems Name reserved but not used
7. Dove Financial Corporation Name reserved but not used
SCHEDULE 4.1(k)-2
TRADE NAMES OF SERVICER
Onyx Acceptance Corporation (the "Servicer") has no trade names,
fictitious names, assumed names or "doing business as" names other than the
following:
"Doing Business As" Name Business for which Name is Used
1. Automotive Banking Network Marketing/Advertising
2. AutoBank Services Used car sales
3. Mesa Auto Used car sales
4. Auto Fund Name reserved but not used
5. Automotive Funding Services Name reserved but not used
6. OAC Systems Name reserved but not used
7. Dove Financial Corporation Name reserved but not used
SCHEDULE 4.1(r)-1
SUBSIDIARIES OF SELLER
The subsidiaries of the Onyx Acceptance Corporation (the "Seller")
are as follows:
(i) Onyx Acceptance Financial Corporation
(ii) Onyx Acceptance Funding Corporation
(iii) ABNI, Inc.
(iv) C.U. Acceptance Corporation
(v) Onyx Acceptance Receivables Corporation
SCHEDULE 4.1(r)-2
SUBSIDIARIES OF SERVICER
The subsidiaries of Onyx Acceptance Corporation (the "Servicer")
are as follows:
(i) Onyx Acceptance Financial Corporation
(ii) Onyx Acceptance Funding Corporation
(iii) ABNI, Inc.
(iv) C.U. Acceptance Corporation
(v) Onyx Acceptance Receivables Corporation
